Guys im 26 and need serious help!

teabelly

What interest rate are you paying on your mortgage currently? The best ones around are 5.1% for 85% ltv with Birmingham Midshires either fixed or trackers.

Firstly, get a proper valuation done. If you can find the same firm that valued it for the first mortgage to value it for a remortgage they are less likely to go massively against their original valuation as it would obviously put them in an awkward position. If they do then you can go to trading standards and challenge the original valuation and suggest the builder and the surveyor were possibly in cahoots and trying to commit mortgage fraud. Once you have a good valuation you can at least either follow a part exchange route or cover the mortgage with the rent if the new remortgage is much better than the old one and hang onto it for a few years while prices stabilise.

Is there any way of turning this one bed into a 2 bed or enhancing it for the rental sufficiently to cover the io mortgage?

Alternatively you could pull the same trick on a propery investment club and suggest there is something going to happen in the local area which will make flat prices rocket. Their greed will overshadow any commonsense. They'll then buy every flat in sight ;-) You offload yours and make it seem below market value ie sell it for the outstanding mortgage plus a few grand. Then you keep your fingers crossed that your big fat whopper doesn't materialise and they make a killing!

poppy10_2

k0108356 wrote: »

I bought a new build property through G.Wimpey for £219, 995 (a one bedroom 768sq m flat).... had no idea about prices (based upon my ex's brothers advice I bought the flat)..... The rent doesn't even cover the mortgage on an interest only basis..... The property must be valued around the £150, 000 mark

Nothing to say but...
PWNED! :money:

Sorry, no sympathy for someone who spent almost a quarter of a million pounds without doing even basic research on the purchase.

Either get repossessed or sell for whatever you can get, then spend the rest of your life paying off the negative equity. Enjoy.

dmg24

poppy10,

The OP has come here for help, not to be laughed out.

Timmne

dmg you can always be trusted to say exactly what I would say!

k0108356

poppy10 wrote: »

Nothing to say but...
PWNED! :money:

Sorry, no sympathy for someone who spent almost a quarter of a million pounds without doing even basic research on the purchase.

Either get repossessed or sell for whatever you can get, then spend the rest of your life paying off the negative equity. Enjoy.

Thanks. Your advice is fantastic and has really moved me on.

k0108356

dunstonh wrote: »

Can you confirm how much deposit you PERSONALLY put down? How much was put down as an "incentive" by the developer/builder?

New builds and appartments are the two things that suffer the most in a property decline. Put the two together and you really suffer.

Builders routinely overvalue property and find ways to hide it by using marketing incentives. These have often been used to allow you to qualify for a mortgage which the lender would never have agreed to by other means. Lenders are cracking down on this now but up until last year they turned a blind eye.

Being honest (and its going to hurt i'm afraid) buying a new build flat in 2005 was never a good investment decision. You entered into a high risk transaction which you would have got away with 5 years early and made a decent profit. However, the risk side is now showing its ugly face and you are looking at potentially a big loss. The developer saw you (and many others like you) coming and thats how they get away pricing the properties above their real value. Although real value is what someone is willing to pay.

You need to get this property valued by an estate agent. You also need to find out how many others are for sale. Just looking at this map :
http://www.nestoria.co.uk/gu17/flat/sale/bedrooms-1

There are flats all over the place and 2 bedrooms with parking are going for 150k-£160k. A few are higher.

The area appears flooded with appartments and thats a bad sign.

This bad investment decision isnt going to impact on the rest of your life but you could lose £50-70k on it and its going to hit your lifestyle in the short to medium term. Your problem is that that property prices are likely to get worse before they get better and it could take 10-15 years for them to get to the level you need. Wimpey are unlikely to p/e on another property with a value higher than what a local estate agent can get you.

I personally put down £11, 000 and as incentive they paid legal costs and stamp duty (charming) with all the trimmings (u know carpets, fixtures, fittings, appliances etc.).

Interest rate is 5.75% fixed until next year.

Here's another scenario, if i sold it (although I would like to try a legal angle re: valuation propety because its seriously wrong) and lost 60k and bought another property. How does it work re: mortgage payments?

homer_j_3

I think you are wasting your time even trying to contemplate that the property was mis-valued. However, if you feel that you have enough evidence that at the time of valuation, the price was over valued by more than 10% then do what you need to do.

If you want to sell the property then you will need to have sufficient money to pay the debt off before the property can be legally sold. If you cannot then the property will not be able to be bought as the lender will not remove their charge until it is.

You are in a very serious situation as you have found yourself in need to sell in a downward market at the moment. I would like to say that you should try and hold out for the recovery but I am not sure you will be able to wait that long.

The risk of buying a house is that its like any investment, it needs to be affordable, sustainable and you should only look to sell when the price is high.

silvercar

poppy10 wrote: »

Nothing to say but...
PWNED! :money:

Sorry, no sympathy for someone who spent almost a quarter of a million pounds without doing even basic research on the purchase.

Either get repossessed or sell for whatever you can get, then spend the rest of your life paying off the negative equity. Enjoy.

I really don't know why you bother to post - to gloat at others misfortune?

Also your advice, if you can call it that, is carp!

OP would be far better off being repossessed then going bankrupt as the negative equity would be written off in bankruptcy.

heathcote123

Sound like you've been screwed, and you probably don't need anyone to tell you how dumb you've been.

I'd seriously be looking at bankruptcy. May as well have a nice long holiday and run up your cc's first - at least get your 11 grands worth.

See, there is always a silver lining!

as for selling it at a 60k loss and tagging it onto the end of another mortgage - well I think your bank may well say NO!

HeadInSand_2

heathcote123 wrote: »

I'd seriously be looking at bankruptcy. May as well have a nice long holiday and run up your cc's first - at least get your 11 grands worth.
!

I trust that was a joke!!

(i.e. don't do that)