Breaking the chain

pip_dax_girl

Hi all, my fiancé and I are in a difficult situation and need some advice. We have sold our current home and had an offer accepted on our next home. The equity we were receiving from the sale was to be used to settle some credit card debts (around £12k) and renovate our new home. We have had a builder visit our ‘new’ home and the solicitors searches come back with some bad news in relation to a public sewer which is on our property. 

The long and short of it is, the builder has advised us not to do the planned works (side and back extension) as the public sewer may cause us issues in the future (eg, not liable for insurance etc). If we moved, it would be a higher mortgage and a smaller house. 

The dilemma face now is, if we stay in our current home, we are not in a position to pay off our debts. Or we keep our buyers and sell up, we do not have a home to go to, resulting in moving to rented accommodation. Does anyone have any advice on how to proceed? Should we stay in our current home and get into more debt? Or not lose our buyers and consolidate our debt until we find a new home? Thank you in advance. 

Albermarle

the solicitors searches come back with some bad news in relation to a public sewer which is on our property. 

Have you any more detail about this? Does it run under the house, or by the side of it, in the garden or where?

MEM62

Using the equity in your home to clear debt should be a decision of absolute last resort and desperation.  It sounds as if the new property is not going to work for you so you need plan B.  How did the debt arise and why are your circumstances such that you cannot clear the debt staying in your current home?  £12K is far from the largest debt issue seen on these forums.

I suggest that you pay a visit to the DFW board and complete an SoA.  The guys there will give you some great pointers of dealing with the debt.  

sheramber

Why are you moving? Do you need a bigger house? 

Flugelhorn

I think you need to look at managing the debt before considering moving 

pip_dax_girl

Albermarle said:

the solicitors searches come back with some bad news in relation to a public sewer which is on our property. 

Have you any more detail about this? Does it run under the house, or by the side of it, in the garden or where?

The public sewer runs under an existing kitchen extension, down the side of the property, and under the external garage. The property is an end terrace. 

pip_dax_girl

MEM62 said:

Using the equity in your home to clear debt should be a decision of absolute last resort and desperation.  It sounds as if the new property is not going to work for you so you need plan B.  How did the debt arise and why are your circumstances such that you cannot clear the debt staying in your current home?  £12K is far from the largest debt issue seen on these forums.

I suggest that you pay a visit to the DFW board and complete an SoA.  The guys there will give you some great pointers of dealing with the debt.  

The debt has come from various credit cards. The reason for the move was to relocate to a better area for transport, commuting and quality of life. Our concern is if we stay where we are, this opportunity will be lost, however the move looks like it is already not an option. Putting it down in words has made me realise consolidating debt is more important. 

MEM62

pip_dax_girl said:

MEM62 said:

Using the equity in your home to clear debt should be a decision of absolute last resort and desperation.  It sounds as if the new property is not going to work for you so you need plan B.  How did the debt arise and why are your circumstances such that you cannot clear the debt staying in your current home?  £12K is far from the largest debt issue seen on these forums.

I suggest that you pay a visit to the DFW board and complete an SoA.  The guys there will give you some great pointers of dealing with the debt.  

Putting it down in words has made me realise consolidating paying off debt is more important. 

Corrected that for you.  Consolidating debt is only moving it, often leading to a negative longer term outcome.  You need to get rid of the debt- i.e. pay it off.

Sort your debt and the future may offer more options to move.     

Yorkie1

Do you have any ideas of how long it might take you to find an alternative acceptable property in your desired area? If it's not long, then you might still be able to keep your buyers happy and purchase the Plan B property. Just keep them informed - it's when you go silent on them that things can get worse.

robatwork

You can possibly buy a reasonably cheap indemnity against the unlikely event of needing to dig up your extension.

Some roads have a sewer running under dozens of extensions

saajan_12

pip_dax_girl said:

MEM62 said:

Using the equity in your home to clear debt should be a decision of absolute last resort and desperation.  It sounds as if the new property is not going to work for you so you need plan B.  How did the debt arise and why are your circumstances such that you cannot clear the debt staying in your current home?  £12K is far from the largest debt issue seen on these forums.

I suggest that you pay a visit to the DFW board and complete an SoA.  The guys there will give you some great pointers of dealing with the debt.  

The debt has come from various credit cards. The reason for the move was to relocate to a better area for transport, commuting and quality of life. Our concern is if we stay where we are, this opportunity will be lost, however the move looks like it is already not an option. Putting it down in words has made me realise consolidating debt is more important. 

These are separate issues. 
1) If you want/need to move, then evaluate that on its merits - is the better area worth it for the hassle and cost of moving? Would the new property be more or less expensive than the current one? 

2) Debts - consolidation means you still have the debts and you just shift the repayment to part of your mortgage. While the annual interest may reduce, mortgages are paid over longer periods so in total you can end up paying more. Plus it means your credit card balances may go back to zero allowing you to rack them up again. 
Instead, how much can you  hone in your monthly budget to directly pay off the debts?