Advice appreciated on loan options

Master_Munchkin

Hello. I will keep this succinct. I’m single, mid-fifties, self-employed, a London home owner (value of property approx £500k with a £23k mortgage remaining). I have v modest savings as I have prioritised overpaying the mortgage and paying into a pension. My work has become v insecure and cashflow is a concern.

I intend to put my property on the market late Spring 2020 to move to a cheaper part of the country. In the interim I need about £20k to pay for pre-sale maintenance work and cash for food and utility bills till the property is sold. Realistically, a sale will take 12 months. I have a lodger covering the mortgage but I need to eat and pay basic bills. I have no credit card debt or other loans. I have few needs apart from keeping a 12-year-old car going and food (quite a lot of lentils!). I have stopped pension payments (with regret). I understand secured bank loans are only approved to those with regular income. I am, of course, pitching for work but it is a fragile situ. I have some family illness with a parent needing a lot of time/travel which eats into the budget and daily routine. I have ruthlessly trimmed all costs.

Any thoughts/suggestions on best £20k loan options to manage this cashflow situ would be appreciated. I am in a pretty good situation overall but the last few years have got tricky.

With thanks.

MM, London

[Deleted User]

With an unreliable income, your only option would be your existing mortgage lender, but the extra borrowing will almost certainly mean another affordability check, which you'll fail.

Can you take in another lodger or otherwise increase your income?

Master_Munchkin

Thanks for this Zx81. No, it's a 2-bed property only. Income – I am looking for work but have few skills outside my professional area. But I am trying to widen my 'marketability'. Cheers

foxy-stoat

Obvious answer is to use your savings and reload them once you have your £450,000 cash in a few months....or call your lender and take a payment holiday for a few months and use the money from the lodger to live on.

You wont be able to get a £20,000 loan with low or irregular income - your annual salary would need to be double your proposed loan target.

Master_Munchkin

I'm afraid the savings pot will run dry sooner not later. I have to fund £10-12k worth of building work on the property (leasehold) in early Spring. I can comfortably manage on £8k for 12 months. This is a worst-case scenario. I am hopeful of getting some work but probably not enough to fund the next year comfortably or reliably. Thanks for your thoughts, F-S.

MM

foxy-stoat

Sell it as it is and price it lower due to the work that is needed.

Master_Munchkin

That's an option, yes. Thanks.