Guys im 26 and need serious help!

LittleMissAspie

Your best option might be to relocate to Camberley with your wife, live there and pay the mortgage together. In 5-10 years you will probably be out of negative equity.

UK007BullDog

I would like to add that maybe he was conned and scammed and not just a novice at house buying.

Please read this (New-build property scam worse than feared, FSA warns):
http://www.citywire.co.uk/News/NewsArticle.aspx?VersionID=101089&re=2472&ea=178988

and this (FSA and police battle nationwide property price fraudsters):

http://www.citywire.co.uk/News/NewsArticle.aspx?VersionID=100820&PageSearch=fraud+appears+to+involve+crooked+brokers+and+introducers%2c+complicit+house-builders%2c+and+fraudulent+surveys

[Deleted User]

This thread is a wind up.

UK007BullDog

Yant1 wrote: »

This thread is a wind up.

Why? What makes you say that?

amandah

k0108356 wrote: »

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

You just need to ignore people like that. So much for getting some advice and re-assurance. Hope you get some positive advice..

k0108356

jamesd wrote: »

k0108356, if you can manage to fund it, holding the property for ten years or more may get you out with a profit. Would take at least 4% a year plus inflation property price increases to get you out with no capital loss (comparing your 220k to 150k) plus any subsidising payments you make over the years. Long term property price growth averages around 8% (deduct inflation for real value increase) so this is not impossible even though prices may take a while to move up.

Or if you can raise the difference between sale price and mortgage balance owed you could sell. You'll have to pay this difference to the lender when you sell or they will block the sale, as is their legal right.

Or you could stop paying, be repossessed, get a very nasty black mark on your credit record and be hounded by the mortgage lender until you've repaid the 50-100k difference between repossession auction sale price and mortgage value plus their legal and sales costs. Probably nearer 100k than 50k.

Your best bet if you can afford it is to wait for inflation. That'll eventually decrease the real value of the mortgage capital and monthly subsidy and property prices will eventually increase to cover the difference in value. But it'll probably take that ten years or more to get out without a loss. After ten years inflation at 3% would have reduced the real cost of the mortgage payments and real balance owed to 75% of the current levels. Wage inflation is more likely to be 5% and that means it'd take more like 61% of what it takes now to pay the bills. So hanging on becomes more and more practical the longer you're able to manage it.

Rents may have risen enough to cover the mortgage in five years. Maybe. It'll happen eventually, just can't predict when.

In the shorter term, you will not be able to remortgage this property unless you can raise the difference between a current valuation and the mortgage amount needed. So you should either try to raise that money or be prepared to pay whatever rate your mortgage changes to after any deal period ends. This may be what breaks you and forces you to accept repossession if you can't handle these higher payments.

Be very, very nice to your tenants. It looks like a market where you could have trouble replacing one and having a vacant property would be even worse news. You might consider seeking insurance to cover void periods but it may prove impossible to get in your situation - but worth trying to protect you from this potential disaster.

Thanks JamesD, clear advice. I know i've been a mug and got lead like a dog on a leash and I really do appreciate the advice that all members have given.

Firstly, the best option for me I personally think is to first of all get a real valuation done. Im going to book this in for 23rd Feb and based on advice here I will get 3 diff estate agents to look at it within one hour (so not to disrupt my tenants too much!!). I currently owe £212 000 to Halifax and if I take a £30 000 hit then well, I deserve it. The £30, 000 I would raise by taking an unsecured loan and maybe friends/family etc.

Secondly, yes your right I could hold on for another ten years but then in this instance I will need to make up £212 000 and plus another x thousands of pounds I have paid out in covering the mortgage and ground rent.

Thirdly, I could try a legal angle with RICS and see where that leads (my assumption is, no where, its a capitalist soceity so some win and some lose)

Fourthly is repossession or bankruptcy but then im screwed over for the next six years. Repossesion would mean paying back more than a voluntary sale.

Members am I basically right in thinking these are my options?

I don't want no sympathy and Im just an average professional earning a good living and contributing to a great country. I just want my life back again and this certainly is not a wind up. i REALLY REALLY wish it was.

k0108356

UK007BullDog wrote: »

I would like to add that maybe he was conned and scammed and not just a novice at house buying.

Please read this (New-build property scam worse than feared, FSA warns):
http://www.citywire.co.uk/News/NewsArticle.aspx?VersionID=101089&re=2472&ea=178988

and this (FSA and police battle nationwide property price fraudsters):

http://www.citywire.co.uk/News/NewsArticle.aspx?VersionID=100820&PageSearch=fraud+appears+to+involve+crooked+brokers+and+introducers%2c+complicit+house-builders%2c+and+fraudulent+surveys

I don't mean to sound relieved at reading this but what I am reading is exactly as described. Its almost as if its been written to hit every dodgy tune around my process of buying this flat. Who do I need to contact guys re: this? I mean someone who will listen and ultimately do something?

UK007BullDog

Contact the FSA and the FOS.

silvercar

Fourthly is repossession or bankruptcy but then im screwed over for the next six years. Repossesion would mean paying back more than a voluntary sale.

Bankruptcy is something that obviously needs to be taken seriously and with professional advice. But just to point out that combining the 2 does remove the negative equity. Your credit rating will be completely screwed for 6 years and you will probably have to live with only a pre-paid credit card for a year and will have no way of getting any credit in the short term - even no mobile phone contract, but it would wipe out the negative equity in one swoop. It is probably the only option that would leave you with no debt in 6 years time.

Capricorn_One

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.

Maybe you should remember 2 things:

1) Forum Etiquette: "Pls be nice to all Moneysavers"
and
2) What goes around comes around... Maybe you'll provide others with a good laugh one day. We'll see how you like it.

He wasn't looking for sympathy, just some help.