I don’t know what to do

Scotsgirl74

I have debts around 20k. I own a house with my husband but I also have a flat in my name only that I have been renting out for 7 years. I’m a reluctant landlord as it’s in negative equity on an interest only mortgage. The prices aren’t rising so I owe £72k on a flat that would probably sell for £50k. I have had 5 sets of tenants, the last 2 have left without notice. My current tenants left on Wednesday with no notice. The flat is needing redecorated again. I don’t have the money redecorate or find a new tenant. I called the mortgage company tonight but there was a long queue for collections. I’ve contacted national debt line. Someone will call me back in a few days that deals with Scottish cases. I’m at a loss I want to send the keys back to the mortgage company but I don’t want to lose my current house. There is equity in our house but with my poor credit I’m assuming it won’t be possible to release it. I dont know what to do or where to turn. This is all my doing and in need to get myself out of this hole but I don’t see a way ever

middleclassbutpoor

Why do you want to hand the keys back? Is it because its in negative equity or because you can't afford to cover the void periods?

Are you financially stretched with the £20k debt you have?

Scotsgirl74

It costs me money every month to rent out. I don’t make anything from it. I have to pay yet another tenant finder fee and the whole flat needs painted. It’s never going to get out of negative equity and I can never afford to change to a repayment mortgage. I am managing my debts at the minute. I pay some of my creditors token payments. I can’t afford to pay the mortgage while it is empty and I dontt have the money to redecorate or pay the tenant find fee. Things are never going to change with it. I’m stuck with it forever

middleclassbutpoor

It really reads as though you feel like you are in a financial prison cell.

Could you post your SOA to see if we can help see where you may be able to free up more income from your income by reducing your expenses?

Have you spoken to your lender about selling the property and coming to an agreement to repay the shortfall? I would perhaps look to get 3 valuations on the property before you do this.

I think the first place to start trying to unpick some of this for you is through looking at your SOA.

https://www.lemonfool.co.uk/financecalculators/soa.php

If you complete there will be a stream of people with suggestions for you to consider.

Scotsgirl74

That’s exactly how I feel. I will do a SOA and post up tomorrow. My head is nipping tonight. I tried to call my lender earlier but there was a long queue for collections and I had to go out.

sunflowerlady

Are you able to sell the house you live in, repay your debts and move into the flat for a while? Then save for a deposit to buy somewhere when you are debt free?

Scotsgirl74

Our mortgage in the house is now smaller than the flat. We would prefer to stay where we are as we were helped with the deposit. We would never be able to save that again

gettingtheresometime

Some LA / HA rent private properties from landlords & as part of the deal will redecorate when their tenant leaves.

If you really can't sell then this may be a solution

HampshireH

Yes sometimes known as residential leasing. They pay your to put their tenants in your house

Here is an example

https://www.highland.gov.uk/info/997/housing_advice/267/leasing_your_property_to_us

fatbelly

Hopefully National Debtline Scotland will get back to you soon. Scottish options will be different from English ones.

They do have some factsheets. https://www.nationaldebtline.org/S/information/fact%20sheet%20library/Pages/default.aspx

I posted the following to someone who is at a more advanced stage than you, and in England

The worst case here is that you are going to have a non-priority debt, similar to your credit card debt. But nothing's going to happen quickly.

You are at a stage where there are still lots of options for minimising that debt.

Scotsgirl74

Thank you. Can’t see anything on my council website so I’ll give them a call on Monday