Negative Equity Nightmare

emmasam0

Hi, hopefully someone on here can help me with my problem.


I bought a 25% share in a property in 2008, which I moved out of 3 years ago as I moved in with my now husband due to my property not being big enough for both of us. Since I bought the property it has decreased in value by roughly 30 - 35K, leaving me in a negative equity of £8,500.00. A member of my family lived in the property at first but then when they moved out my only option was to look at renting. I couldn't sell due to the negative equity. After going through a lengthy process the housing company finally agreed to let me sub-let the property temporarily as did the mortgage company. Now the mortgage company have said that I can no longer do this and my only option is to go onto a mortgage at a higher rate as it's a consent to let mortgage and not a residential.


I am totally stuck with this property and not sure what way there is out for me. I am at a loss financially every month even with having someone living in the property and now my mortgage rate is increasing. I still can't sell due to the negative equity I owe and I really can't see a way out. I have looked into purchasing the other 75% but that won't work either. It's going to take me at least 9 years to pay off the mortgage that I owe at the current rate.


Does anyone have any suggestions or advice? It's difficult to find someone who knows all about the shared ownership in's and out's.


Thank you!

Pixie5740

Have you looked into getting an unsecured loan for the £8,500 shortfall?

Comms69

Your choices are:


Let it out (and get increased mortgage rate)
Live there
Sell it and pay the difference
Let it get repossessed

theartfullodger

Or declare as bankrupt, wipe the debt: Now, wonder who pays...

bouicca21

If you are at a loss every month surely you would be better selling the place and swallowing the 8 grand loss.

AdrianC

You keep saying you "can't sell" due to the negative equity - but you can. You would simply need to find the shortfall.

You say you're losing money every month in the current situation - how much? For how long now?

Just cut your losses and get away from this situation.

hayleylouise1991

you can sell the property and you are liable for the shortfall (negative)
....

glentoran99

emmasam0 wrote: »

Hi, hopefully someone on here can help me with my problem.


I bought a 25% share in a property in 2008, which I moved out of 3 years ago as I moved in with my now husband due to my property not being big enough for both of us. Since I bought the property it has decreased in value by roughly 30 - 35K, leaving me in a negative equity of £8,500.00. A member of my family lived in the property at first but then when they moved out my only option was to look at renting. I couldn't sell due to the negative equity. After going through a lengthy process the housing company finally agreed to let me sub-let the property temporarily as did the mortgage company. Now the mortgage company have said that I can no longer do this and my only option is to go onto a mortgage at a higher rate as it's a consent to let mortgage and not a residential.


I am totally stuck with this property and not sure what way there is out for me. I am at a loss financially every month even with having someone living in the property and now my mortgage rate is increasing. I still can't sell due to the negative equity I owe and I really can't see a way out. I have looked into purchasing the other 75% but that won't work either. It's going to take me at least 9 years to pay off the mortgage that I owe at the current rate.


Does anyone have any suggestions or advice? It's difficult to find someone who knows all about the shared ownership in's and out's.


Thank you!

You have been paying the mortgage for 9 years, What is the outstanding balance on the mortgage and the current value?


Unless it is an interest only mortgage then the negative equity wont be as much as you have said,

Gwendo40

This is what happens when we have almost a decade of government/BoE policies that are aimed at protecting existing homeowners at ALL costs... the concept of negative equity or reduced values become almost incomprehensible to people.

dimbo61

You say you are losing money each month.
are you paying a repayment mortgage ?
Could you change to a BTL mortgage ?
What is the increase the lender wants ? are they offering to let you change onto Interest only ?

TBagpuss

Do you have children? If not, why is the property too small for you and your husband?
Would moving back in be a short term solution to let you overpay and get out of negative equity?

If that isn't possible, then it's worth looking into whether you could sell and pay off the shortfall.

Do you or your husband have any savings? If not, have you looked into whether you could get a loan, and how the cost would compare with switching to a consent -to-let mortgage.?

It might be less stressful for you to sell and pay off the shortfall through a loan.

Is the £8,500 negative equity the figure now, or 3 years ago when you moved out?

How much rent could you get compared with the cost of a mortgage on a consent to let basis?