Help: reduced income, huge mortgage, end of deal

meanmachine_2

Further to an earlier thread, is it possible herbie to namecheck some of those lenders that take unguaranteed bonuses into account?

And going back to the OP, I would suggest that, if you are massively in debt and cannot possibly pay the mortgage, then yes you should consider downsizing.

But, to be honest, I have loads of friends - recent FTBers (the fools!) - whose mortgages are more than 60% their take home pay :eek: , and that's without the chance of a bonus.

If you add a bonus of, what, 10% on top, then it's not so scary, especially if you can fix.

And hasn't the SVR just dropped to 6.5%?

It does baffle me that posters on this thread think there is no chance of a housing crash, yet forget that anyone who bought in the last 2 years or so is saddled with a HUGE mortgage that effectively stops them having any kind of disposable income.

That's why the high streets are struggling.

meanmachine_2

ejones999 wrote:

£23k = take home pay of what £1550?

According to iresign it's 1434 per month, leaving about 700 to pay bills. That's certainly possible.

200 for food.
200 for travel.
100 council tax
100 utilities
100 insurance etc

Tax credits and bonuses for kids' clothes and tiny treats.

Paulina_Fortune

Hi,

I'll add my two pence worth. Kids cost money - lots of it - how are you going to cope with the extra expense? I doubt you will want to downsize when you are planning to have or have kids.

You are right to be looking at a replacement mortgage deal - that will help a bit. Is it possible for your wife to get an evening/weekend part-time job? Could you take in a lodger? In any case, look at every penny you spend and cut it where you can.

Good luck.

Paulina.

dccarm

Have you elected to transfer your wife's tax free allowances to yourself now that she has stopped working? That shoould boost disposable income by a bit.

YorkshireBoy

dccarm wrote:

Have you elected to transfer your wife's tax free allowances to yourself now that she has stopped working?

I'm sorry, I don't understand this. Please could you elaborate a little.

Spendless

dccarm wrote:

Have you elected to transfer your wife's tax free allowances to yourself now that she has stopped working? That shoould boost disposable income by a bit.

You can't transfer a non used tax allowance to the working spouse- unfortunately. Wish you could as we would do it as my hubby has a negative tax code. Have you mixed it up with putting savings into a non tax payers name?

abc

Have you asked your existing lender what will happen when the discount period ends? Will they offer you another discounted rate without having to make a full application again.

I recall just before my discount period ended my lender wrote to me saying it was about to end and inviting me to switch to another discount rate. It tied me in for another 2 years redemption penalty wise and I had to pay a fee of around £200 but as I didn't expect to move within the 2 years and it saves around £100 per month in mortgage payments I thought it was worth it.

I didn't have to fill in any application form, just sign a form to amend my terms and conditions. From what I recall they didn't enquire or ask me anything about my employment or salary at all.

jonesMUFCforever

Spendless wrote:

Which is exactly why we need more detail from the OP instead of just telling him to sell his house-do you not think?

Please see posting no. 7 about this.
Eric

Spendless

ejones999 wrote:

£23k = take home pay of what £1550?
Interest only at svr of 6.79% = £8827 pa or £736
Council tax bill = ??
Gas and Elec. = ??
Any o/s loans and credit cards??
Water bill ??
Food ??
Clothes??
Entertainment money??
Child expenses??
Running one and possibly 2 cars ??
Life Assurance policies and or a means of repaying mortgage capital??

Figures don't add up to me and I would'nt be confident of landing a re-mortgage at 4.5% with your present salary.
But what do I know///??
Eric

This is post no 7 as I've already pointed out we need to know more about bonuses and benefits. Until the OP returns and can give us more details I see no point in continuing.

dccarm

Spendless wrote:

You can't transfer a non used tax allowance to the working spouse- unfortunately. Wish you could as we would do it as my hubby has a negative tax code. Have you mixed it up with putting savings into a non tax payers name?

My apologies. I'm still living in the distant past where I studied tax. Things have changed since then...