Difficult situation

Doozergirl

It's only two years to 2019 and that is when you will have some freedom from the DMP. I wouldn't sell up at all. Your debt payments are manageable and interest free so there is no genuine gain to paying it off in one go other than the feeling of being debt free. I think that would quickly be replaced with the anxiety of being a tenant and wondering how/when to get back on the ladder.

I don't think the security of home ownership is less important than the label of being debt free.

Sub prime equals expensive. Rent that is double your mortgage is expensive. Your husband is potentially jeopardising your financial position with the romantic idea of paying off debt.

I'd really try and stick it out. It might be possible to port the mortgage and that would be second best.

danslenoir

dks wrote: »

I have a friend ready to rent our house which would cover the mortgage payments, thus we keep ownership but move into our own rented.

You may be happy to rent out your property, but will your mortgage lender be too?

If you have a standard residential mortgage you cannot rent your house out without your lender's consent unless you want to commit fraud.

Lenders don't generally like giving consent to let because it makes things for difficult for them if they need to repossess.

Until as/when you obtain such consent, I wouldn't bank on this idea as a feasible solution to your dilemma.

harrys_dad

if you sell your house your financial position will change, hence your DMP will change too. After a few months any capital left over a cerftain sum that has not been used to purchase a new house will then count against any housing benefit entitlement you may have in your new rented house. Have any of your creditors put a charging order on the house?

If you rent your house out you will then have a capital asset which is not your home which will affect your benefit entitlement too. You might consider asking for details on the debt free wannabe board.

bouicca21

In my experience renting has always been more expensive than mortgage payments on a similar property. Owning a house also insulates you against price rises.

Who knows what the market will be like in 5 years time? You would be gambling on it being static or falling. It might just pay off if the economy crashes, but it's a dangerous gamble and if the economy does crash, all the rest of your financial calculations will be wrong.

I'd be planning to stick it out, irrespective of bad neighbours, and I'd be haunting the debt free board.

marliepanda

If you sell, in your own figures you'll have 50k, you won't get housing benefit until that's run down.

If you rent it out, you will have a house you're not living in, you won't get housing benefit.

If you rent it out, not only will you have to cover your own rent which you state is higher than what you're paying now, you'll also be responsible to fix anything that goes wrong in your old house, plus pay tax on the income etc.

Can you actually afford to rent it out and rent as well?

Pixie5740

You're on a DMP so if you let the property out how will you pay for maintenance, repairs, referencing and advertising?

You don't like living next to these neighbours so what makes you think a tenant will fair any better. It's rather dishonest to move out of a place because you find the neighbours intolerable but are quite happy to take money off a tenant who will have to endure the same neighbours.

What exactly is the problem with the neighbours? Is it just one neighbour or a whole neighbourhood? What have you done to try and improve the situation with your neighbour(s)?

TBagpuss

Have you spoken to your current lender to ask whether they would consent to you porting the mortgge to a new property? If so, that might be worth exploring.

missbiggles1

Cakeguts wrote: »

Enter the house into an auction. Get rid of it and the neighbours. Rent for a few years until your children leave home and then buy another house when you don't need a family sized house anymore?

Who knows what property prices will be like in 20 years time?

carefullycautious

Go over to this blog


https://frugalqueen.co.uk/


for ideas on how to clear debt. She managed to keep her house and clear 45k of debt. Lots of straight forward advice.


I think doozergirl has given the best advice above.


The worst thing you could do is rent privately and be responsible for all landlord costs and losses on your house. :eek:

dks

Thank you for the replies.

We have decided that renting out our house wouldn't be worth it given that the costs and tenants could be a nightmare.

The problem with the neighbours is just the neighbours attached to us (semi). It's between us and them, there wouldn't be an issue with new occupants as its personal (can't go into details as police may be getting involved). This is why for the kids sake and ours we need to move.

We currently pay 450 mortgage. Rent is about 700 for a smaller house, 850 for same size.

Would selling up and renting ourselves be sensible?

It's not really about clearing the debt it's more getting away from neighbours.

But the worry of 5 years renting and saving to get back on the ladder whilst maybe moving if landlord evicted us for any reason. It worries me because our kids are only 1 & 7.

With several defaults in 2014, plus a dmp until 2021, is a mortgage possible? We are on halifax's svr, wouldn't mind paying a bit extra and it is portable. But don't they credit check you? We ported in 2012 before the debt and it was a whole new application