Phoenix shared equity night mare

Crashy_Time

elsien wrote: »

And the point of offering redundant unhelpful advice when it's too late to change the decision made is?
Maybe you should keep your pointscoring to the more discussion based threads, and not rub salt into the wounds of those who have come here for help.

Fair enough, but the OP has experienced a useful learning curve, and my advice could be useful to people experiencing "Pressure" to take on mortgage/SO debt at the present moment (although I think the chorus of "Buy Buy Buy" has definitely quietened down across the country now, and IMO this can only be a good thing) For the OP right now my advice would be to try and keep the house and make payments.

spamiad

AdrianC wrote: »

Just to clarify my understanding of the situation...

You bought a £100k property 11 years ago with 100% borrowings (£75k mortgage, £25k shared equity)
The property is now worth £78k.
Your outstanding debt is now £64k mortgage + £20k shared equity = £84k = 107.7% LtV.
You have £0 savings.

You said you have a 95% mortgage available to you = £74k.

So your basic choice is to try to raise £10k, somehow, so that you can remortgage to 95% LtV, or sell and crystallise your £6k negative equity.

Bankruptcy over a £6k debt seems overkill, especially considering the shared equity lender are offering monthly terms for the shortfall.

So, really, this comes down to whether you can find the additional £4k and keep your property. If at all possible, this has to be the better option.

What is your current mortgage monthly cost? What's the £150/mo going towards? What interest rates?

A £74k mortgage is not going to be a huge albatross of a monthly payment - even at a high 5%, it's less than £450/mo. Can we ask about your income and working hours? Is there scope to increase them? Full-time minimum wage is nearly £1,400/mo come April.

Thanks for your reply


I have no savings and for one reason or another I am unable to raise the 10k difference, I have spoken to another mortgage advisor and I need to pay off one of my loans before a 95% mortgage is available to me.


I work Monday to Friday so I only have weekends free and although OT is sometime available its not allways and I take it when I can


The £150 pm is going towards paying off the shared equity side, my mortgage is currently 266 per month.


I am on a good wage, but I have debts, two loans a credit card, which will be clear by xmas.


Also my service charge for the flat is killing me at nearly £200 pm

spamiad

Crashy_Time wrote: »

You would have been better off renting cheaply and trying to build a cash-cushion/diversified portfolio.

Thanks I was renting, and it was expensive, not expecting that my property wouldn't retain is value in ten years, not make any, but break even would of made me equally happy, I have struggled for years to pay for this flat never missed a payment and gone without sometimes.


It was the right decision for me at the time

spamiad

lisyloo wrote: »

It’s almost never that I would defend crashy, but this information might be useful to a lurker reading the thread.

I agree, I have been lurking for months, and found hardly anything to help with this matter, I will keep this thread updated with the outcome for that reason

AdrianC

spamiad wrote: »

I work Monday to Friday so I only have weekends free and although OT is sometime available its not allways and I take it when I can

So you are working full-time? So even on minimum wage you're earning £1,400/mo before tax, c.£1,230 after.

The £150 pm is going towards paying off the shared equity side, my mortgage is currently 266 per month.
...
Also my service charge for the flat is killing me at nearly £200 pm

That's £616/mo...

What interest rate, if any, are you paying on the shared equity?

spamiad

AdrianC wrote: »

So you are working full-time? So even on minimum wage you're earning £1,400/mo before tax, c.£1,230 after.



That's £616/mo...

What interest rate, if any, are you paying on the shared equity?

Im not 100% sure im at work at the moment but I think its around 9%


you must realise I have two loans which have to come out of my wages every month


Loans
£186
£228


cc


£130


Car ins


£45
£14 tax


Flat


£266
£36
£189
£150 phonix

lewisa

I think G_M is correct in that you need to seek proper advice, but I also think AdrianC is correct in that the situation is probably not so far gone that it can't be rescued.

AdrianC

Well, I presume you chose to borrow that money since you moved into the flat...?

NINE PERCENT interest on the shared equity? Jesus wept! Sounds like that £150/mo is just interest, no repayment.

spamiad

AdrianC wrote: »

Well, I presume you chose to borrow that money since you moved into the flat...?

NINE PERCENT interest on the shared equity? Jesus wept! Sounds like that £150/mo is just interest, no repayment.

my point made, im more annoyed that they are pressuring me for the money I do not have, I have told them I do not wish to sell the property, would be silly to do that.


In four years all my debts will be cleared and 95% mortgage will be no problem then.

spamiad

spamiad wrote: »

my point made, im more annoyed that they are pressuring me for the money I do not have, I have told them I do not wish to sell the property, would be silly to do that.


In four years all my debts will be cleared and 95% mortgage will be no problem then.

someone mention going bankrupt, but I cant see that working either as the flat is in such negative equity.


I don't want to go down that route as much as I am skint, I have allways paid everythig