Trying to move abroad - shortfall property

TheGreatEscape

Hi everyone,

Hoping to get some advice....

I have a property in shortfall that is worth about 65% of my current o/s mortgage.

I met a girl from Belgium 10 years ago and we are now engaged. I had hoped to move to Belgium years ago, but have been unable to because of this house. At this stage, 10 years later, our relationship is seriously under pressure as I still haven't moved as promised.

I have an interest-only mortgage, so it's not going down, and I don't feel I can afford to switch to repayment. I thought I would have been in that position by now, but something always comes up. I'm currently supporting my partner as she's living here (and hates it) and has been unable to find work here due to her level of English (and the lack of jobs where I live).

I have never missed a mortgage payment and have an excellent credit rating at the moment.

What steps should I take to move abroad? I have been thinking about selling the property and paying off the shortfall, whilst renting, before I leave the country. I understand though, that the bank may not release the property for sale, given the circumstances. Should I just be honest with them and see if they will work with me?

I'm really at the end of my tether with it all, and any advice would be appreciated....

Thanks...

Jono

Thrugelmir

If you are not making any repayments to reduce the capital owed then you are going nowhere fast. Even if you cannot afford full repayment you need to start paying down the debt.

MortgageMamma

Oh no, you must be feeling pretty horrible.


How about you put some figures on and see what can be done


1. How much is property worth and when did you last get it valued?
2 . What is outstanding mortgage amount, who is lender?
3. Are there any secured loans as well as the mortgage?
4. Have you had a market appraisal to see how much rent you would get for the property?
5. Have you phoned your lender to discuss any of this?
6. I'm not sure the lender can prevent a sale, if they can I've never heard of it done. If you chose to sell and there was a shortfall would you be able to pay it off over time, even if living/working in Belgium?
7. Not entirely related but would be useful to know, if you did relocate to Belgium would you rent or live with her family?

TheGreatEscape

Hi MM,

Thanks for your reply. Yes... its not a great situation I find myself in.

1.) I would say its worth about 85-90k, judging by similar sales. It's a long time since I had it valued though - not since before the crash.
2.) The o/s mortgage is 140k with Halifax
3.) There are no secured loans
4.) No, but I guess it would be around £550p/m
5.) I haven't spoken to the lender yet
6.) Yes, I could pay the shortfall off over a short number of years. If I went to Belgium it would depend on the work I could find, so it would be best if I stayed until it was paid.
7.) I would be renting in a beautiful little town near where her parents live in Bruges.

TheGreatEscape

Nice quote on your message Thrugelmir - I wish I'd read it 10 years ago

MortgageMamma

TheGreatEscape wrote: »

Hi MM,

Thanks for your reply. Yes... its not a great situation I find myself in.

1.) I would say its worth about 85-90k, judging by similar sales. It's a long time since I had it valued though - not since before the crash.
2.) The o/s mortgage is 140k with Halifax
3.) There are no secured loans
4.) No, but I guess it would be around £550p/m
5.) I haven't spoken to the lender yet
6.) Yes, I could pay the shortfall off over a short number of years. If I went to Belgium it would depend on the work I could find, so it would be best if I stayed until it was paid.
7.) I would be renting in a beautiful little town near where her parents live in Bruges.

OK here goes


1, get it valued for sale by a reputable local estate agents, this won't cost anything. If poss get 3 valuations and plump for the average of the three figures.


2, go to a letting agent, preferably an ARLA registered one and get a rental appraisal. A good letting agent will also tell you how to depersonalise and prepare your property to be rented out.


3. You cannot do anything more until you have these two figures.


4. Look at what your rental costs will be for Belgium and how you would pay for those, could you stay with family there until you found work?


5. Your monthly rental payment needs to be at least equal to your mortgage payment. You may be able to obtain consent to let from your mortgage lender. You need to consider landlords insurance as you won't be in the country to deal with repairs. read up on the responsibility of being a landlord and see if you think you could handle it.


6, if you cannot rent the property out for some reason, then speak to the lender and sell it. They will come after you for the shortfall (if any) but you can address that with monthly payments. The company who chase you for payment will have to do an income and expenditure statement with you to see what you could realistically afford to pay every month.


But the first thing you need to do before you can go further is get the property valued and a rental appraisal.


Edit - have faith in yourself that you can sort this. if you have been with your partner for 10 years her happiness and yours is far more important than a little bit of debt - so don't let this present situation stop you from achieving your goals. It may sound somewhat irresponsible of me but remember a debt collection firm can only take what you have. They cannot take what you don't have. If you have no assets, no income, no job for short time whilst in Belgium there is nothing they can do immediately. That will get them off your back for a bit. There are charities that can help you with this situation, to deal with the debt. Remember whatever you choose to do if there is negative equity it will have to be paid back eventually or you'll be made bankrupt or they could perhaps attempt an attachment to earnings order. http://www.stepchange.org/

TheGreatEscape

Thanks for your valuable advice MM....

I guess sometimes you just can't see the woods for the trees.

MortgageMamma

let us know how you get on, there may be obstacles ahead but come back to the forums and talk them through - as you don't need a mortgage you can inbox me for guidance if I'm not responding to posts as I am often busy with proper work!