Help Needed - Difficult Situation

robbo147

Not sure if I am posting in the right place forum wise so feel free to move if needed

Basically myself and my wife are in a situation where:

We have one child (age 6) and a baby on the way. We are in a 2 bedroom property which is still mortgaged jointly between my wife and her ex. House value is approx £105k. It was mortgaged with Birmingham Midshires on a mortgage plus account so there is a mortgage and unsecured loan element. Remaining sums now stand at £77,000 and loan £25,500 If sold the sale price would settle mortgage and loan but leave no actual profit.

I own (with mortgage) a property which we were renting out until Dec 2014. It is empty now and on the market for £112,500 (reduced asking price last week). Current mortgage value is around £67,000.

The idea was to sell the flat and use the equity to pay off my debts (approx £30,000) and then use the remaining profit to buy a bigger property to allow for our growing family or if we didn't have quite enough, stay in the property we're living in now and try to add to the profit from the flat sale to get a deposit big enough to buy someone with 3 bedrooms.

However flat is proving more difficult to sell than we anticipated. As stated I have reduced the price and it doesnt seem at all unrealistic given competition, location etc. However it's getting to the stage of debts getting higher due to paying 2 mortgages, council tax etc so looking at options and need advice.

My mortgage was taken out with Northern Rock so extra borrowing on existing mortgage not possible to pay debts off to reduce monthly outgoings.

I have even considered one of the 'cash offer' places or selling at auction but am a bit worried about getting ripped off. Other option is to remortgage my property until it sells but concerns there about early repayment fees etc so I feel pretty stuck right now.

Any advice would be greatly appreciated.

TonyMMM

Lower the price again

Foxy-Stoat_3

Looks to me as the 2 bed house will have around £25K equity once sold, will the Ex. want anything from the sale and is the unsecured loan anything to do with the Ex?

What sort of value are you looking for on the next property?

Your property's equity will be around £38K once sold assuming 1% EA fees £1K legal and a sale price of £105K, less the £30K debt, doesnt leave you with much to buy the next property.

robbo147

Hi

Thank you both for your replies.

Foxy-Stoat if we sold the 2 bed house the approx £25k profit would have to be used to settle the BM unsecured loan. Both are in joint names of my wife and her ex. The ex isn't interested in any profit nor has he any intention of contributing to any shortfall. He moved out years ago and hasn't paid anything towards the mortgage or loan since.

House we'd like to buy value wise would be around £140k for 3 bed semi in the area we currently live. I have looked into possible mortgages on my income and with a £38kish profit/deposit it wouldn't be an issue but of course all depends on my property selling. At the moment I'm attracting viewings but unfortunately the negative feedback is about things outside of my control such as communal areas (property is a flat) and proximity to a garage just next door to the block. It was on the market for £119,500 but have reduced by £7k only last week hoping that might make it appeal to a wider audience or outweigh the negatives people don't like.

In the meantime it's a struggle paying 2 mortgages etc which means the debts I have of £30k are slowly but steadily getting higher, eating away at more of the potential equity. I only reduced last week so thinking if I reduce again so soon it may make me look v desperate? Want to sell but at the same time don't want to be ripped off so feeling a bit stuck between a rock and hard place

Foxy-Stoat_3

Whats the joint income?

robbo147

My income is £33,000 with guaranteed bonus of £2,500 per annum (bonus usually a bit more but not guaranteed so can't include)

Wife works part time so income is £7,200 (£601 per month), soon to decrease (as of mid-July) to maternity pay of approx £530 per month.

Foxy-Stoat_3

Maybe go and see a broker with your credit reports for options, assuming you have buyers for both properties.

They will be able to tell you how much of the equity to use for paying down the debt and new deposit to get the best deal.

norfolkshops

can some one look at this

http://www.mirror.co.uk/money/bedroom-tax-appeal-extra-bedroom-too-small-count-room-5769k936

is this law to all in the uk.its the size of room i mean thank you and take care

Foxy-Stoat_3

norfolkshops wrote: »

can some one look at this

http://www.mirror.co.uk/money/bedroom-tax-appeal-extra-bedroom-too-small-count-room-5769k936

is this law to all in the uk.its the size of room i mean thank you and take care

What has this got to do with the OP's problems?

Didn't click the link, probably a virus.

Take care