Danger of arrears - help

jenni646

I bought a house in Maidenhead with my husband in 2017 on a 95% mortgage (it was our first house) - very good house for the money, great size, no red flags etc.

Since then, we have got divorced and need to sell the house. Currently we each pay half the mortgage and he still lives there so also pays all of the bills and upkeep. The house has been on sale since last August but the market has massively slowed and whilst we have had over 40 viewings (and still more each week), it's just not shifting.

We have already reduced the price to less than we paid for it but the estate agent is saying that realistically it needs to be reduced even further, to less than would cover the mortgage, let alone fees, in order for it to sell. We have 2 agents on it at the moment.

To make matters worse, as i am now renting a flat elsewhere, i am struggling to pay both costs and only have until June before i can no longer afford to pay the mortgage. I have spoken to my ex, who cannot afford to pay the whole thing himself, and i have also spoken to our mortgage lender. They cannot switch our deal, move to interest only or give us a payment holiday without our credit rating being destroyed (and even then may not give it to us). I have also looked at letting it out but the lender would add an extra 1% to the mortgage interest each month to allow us to do it and i dont think we could get enough rent to cover the mortgage anyway.

Does anyone have any advice on what i should do or how i can proceed? I am quite scared about what happens after June and the estate agent doesnt hold much hope to sell it for anywhere near what we need to pay the mortgage off.

Any thoughts or advice would be very welcome!

Mortgage_Adviser

OP, what is a current LTV on it? Is it still 95%?
Are there any savings to drop it down to 80% so the place could be remortgaged to competitively priced buy to let with your ex husband moving out? Although there would be a short term pain having to pay money reducing down the mortgage, the fact it would become interest only buy to let and will get a rent amy massively help.


Has your ex husband considered taking in a lodger/lodgers to cover some of the mortgage?

jenni646

Current LTV based on value we are on market for now is 94% - based on the value we bought at it's 92%. Unfortunately we dont have any savings.

I have mentioned about renting out the rooms but he is against this as from his perspective, he is able to continue paying his half of the mortgage, 'so why should he have to live with a stranger because i moved out'...

Thanks

<EDIT> - ive just logged into my mortgage account and it says 90% LTV so im not sure how they have calculated that but its probably more official than mine!

BoGoF

Does he understand the repurcussions of missed payments for his credit file?

Mortgage_Adviser

jenni646 wrote: »

I have mentioned about renting out the rooms but he is against this as from his perspective, he is able to continue paying his half of the mortgage, 'so why should he have to live with a stranger because i moved out'...

Would he be more keen if you told him that you would be happy for any money earned from the lodgers would eat in to your share when the property is sold eventually?


He also needs to understand that if you stopped paying it would not only be your credit history that it would be trashed but also his as it is a joint mortgage and the lender would not care whic one of you's is at the fault they no longer get payments from.


If you were to still consider selling, would you sell the property at least for an outstanding mortgage amount? At least to get rid of the house abnd have a fresh start.

jenni646

We could sell at an amount that will pay off the mortgage, but it wouldnt cover any early repayment fees or the estate agent fees. I think thats where im struggling - i put all the money into the house to buy it, the entire deposit and stamp duty, so we agreed that anything coming from the sale goes to me. If we sell for only enough to cover the mortgage then i have nothing to move forward with but also we are still around 8k short to cover estate agent and repayment fees.

BoGoF

You need to be clear with your husband, either he rents a room out or he will end up homeless with a trashed credit file.

There is no 'half share' as far as the mortgage company is concerned. Have you told him you can't sustain this past June?

jenni646

Yes i have. he is very sympathetic and wants to help get the house sold so he can move out and find another place (as he hates living in our marital home now) but he just cant agree to renting out the other rooms - and also, that would mean we would have to have additional insurances and a contract so we couldnt continue to try and sell the house. I think he wants to avoid the mess of that, which i understand.

Has anyone used one of those house buying services with success?

BoGoF

jenni646 wrote: »

Yes i have. he is very sympathetic and wants to help get the house sold so he can move out and find another place (as he hates living in our marital home now) but he just cant agree to renting out the other rooms - and also, that would mean we would have to have additional insurances and a contract so we couldnt continue to try and sell the house. I think he wants to avoid the mess of that, which i understand.

Has anyone used one of those house buying services with success?

I take it that you caanot afford the mortgage on your own if he were to move out.

I would avoid any 'sell your house quick' company. You will get nowhere near market value.

jenni646

No, i am also paying rent on the place im living in so i can barely afford the half mortgage im currently paying and wont be able to past June.

Thank you for your thoughts though!

getmore4less

This happens a lot once you move out there is no incentive for the occupier to move out.

If the buyers get wind of a divorce sale a lot will be interested but won't risk the hassle or risking the buyout taking the place from under them.

maidenhead lets have a look at the market

without a guide on price beds etc. can't narrow down much, for sale/SSTC
price 2,3,4+
0-300 085/17 008/01 02/0
0-400 159/53 052/33 04/0
0-500 187/66 105/74 21/8

have a look where yours fits price/beds and see what people are buying.
you need to go from around +20% down and compare,

People are buying so what are they picking for your money over yours.