GolfGTIforum.co.uk
General => General discussion => Topic started by: Andy P on 11 July 2011, 18:58
-
Anyone work with Mortgages or had much experience with them?
Basically we are looking to move but our place is worth less than when we bought it. Probably about 10k less. We are looking to buy a new place but it will cost more money. Currently we are fixed at 6% but looking to track base rate at the end of the year.
My question is are we realistically going to be able to borrow more money if we are in negative equity? If we bought a place to make money on, could we cancel out our equity that way?
Cheers :)
-
I could be shooting widely here, but... If I were a bank and you were selling your house to be in negative equity, I'd want you to fork out the cash to put things square again. You're better off staying put until the market sorts itself out to be honest.
-
As above your best off staying put for the time being. You will need at least a 10% deposit - more likely 20% tbh, and considering your current house is in negative equity, you will have to fork out even more to make up what you lent in the first place. Unless you are moving into a house worth less than your current one, it really isnt worth it.
-
Anyone work with Mortgages or had much experience with them?
Basically we are looking to move but our place is worth less than when we bought it. Probably about 10k less. We are looking to buy a new place but it will cost more money. Currently we are fixed at 6% but looking to track base rate at the end of the year.
My question is are we realistically going to be able to borrow more money if we are in negative equity? If we bought a place to make money on, could we cancel out our equity that way?
Cheers :)
In short. NO.
You bought unwisely :wink:
-
http://www.insolvencyhelpline.co.uk/debt_factsheets/negative_equity_what_can_I_do_if_I_want_to_move_house.php
-
Anyone work with Mortgages or had much experience with them?
Basically we are looking to move but our place is worth less than when we bought it. Probably about 10k less. We are looking to buy a new place but it will cost more money. Currently we are fixed at 6% but looking to track base rate at the end of the year.
My question is are we realistically going to be able to borrow more money if we are in negative equity? If we bought a place to make money on, could we cancel out our equity that way?
Cheers :)
In short. NO.
You bought unwisely :wink:
Can't really say he bought "unwisely" as you never know when the market is going to crash or stabalise etc.. I am sort of in the same boat, split up with my fiancee, wanted to sell up, house is 10k down, so I took the place on myself, gave her 10k and started to rent the place out, financially i am in a bit of a pickle at the moment as I needed to take a loan on to buy her out.. but now i have someone in the place, got a trickle of money coming in so all is ok.
Have you thought about renting it and looking to buy another?
-
The only way I can see you moving is if you move to a new build and the builders do you a good part exchange deal (possible in this climate), but even doing that you're going to need a fairly big deposit. Sit tight, change your mortgage if you can get a cheaper rate and save up a bit more would be my advice.
....oh yeah, and if you are in negative equity, make sure your mortgage is repayment and not just interest only so you are chipping away at the loan all the time.
-
Anyone work with Mortgages or had much experience with them?
Basically we are looking to move but our place is worth less than when we bought it. Probably about 10k less. We are looking to buy a new place but it will cost more money. Currently we are fixed at 6% but looking to track base rate at the end of the year.
My question is are we realistically going to be able to borrow more money if we are in negative equity? If we bought a place to make money on, could we cancel out our equity that way?
Cheers :)
In short. NO.
You bought unwisely :wink:
Can't really say he bought "unwisely" as you never know when the market is going to crash or stabalise etc.. I am sort of in the same boat, split up with my fiancee, wanted to sell up, house is 10k down, so I took the place on myself, gave her 10k and started to rent the place out, financially i am in a bit of a pickle at the moment as I needed to take a loan on to buy her out.. but now i have someone in the place, got a trickle of money coming in so all is ok.
Have you thought about renting it and looking to buy another?
true, no-one knew the crash was coming?
shouldn`t your ex have paid you £5k to take the house on? as really your now £20k down?
-
The main problem with mortgages is people over extend themselves.
I was offered a silly figure for a remortgage in 2007, if had taken it, it would of spelt alot trouble if the market sunk.
Always borrow wisely, whatever the current interest rate.
-
I should be buying a house in the next 12 months fingers crossed. The Mrs has just started working at Halifax, they do 0.5% for employees! :cool:
-
Just as I thought really. I didn't buy unwisely but the Market was at it's peak which nobody knew at the time. Also I only put down a 8k deposit. Now you need a massive deposit and there is no way I could afford a 25-30k down payment.
It's frustrating as I want a garage! I have the space to build one but if I do I will want the money I spend to reflect in the price. But this will then price me out of the "first time buyers" price bracket.
I don't have enough for a deposit for another place, unless I can release a bit of equity in the current property to put towards another.....equity that I don't have!
I could sell up and move to a really crap area but I really don't fancy that!
Luckily I'm earning about 15k a year more now so eventually I can borrow more.
-
Just sit tight things will improve, a lot of people will be in the same boat.
-
Just sit tight things will improve, a lot of people will be in the same boat.
Yeah I know. But you know when you get something in your head?
Nobody ever made any money standing still. ;)
Thanks for the input chaps!
-
just think of it as a bonus that you own your own place mate, there's plenty of people out there that can't even get on the ladder at the mo
I can't think of moving any time soon as I don't own enough of my place so just staying put for a good few years and trying to pay an extra £100 a month off the mortgage with the missus, should knock a few years off the loan :smiley:
-
Just as I thought really. I didn't buy unwisely but the Market was at it's peak which nobody knew at the time. Also I only put down a 8k deposit. Now you need a massive deposit and there is no way I could afford a 25-30k down payment.
It's frustrating as I want a garage! I have the space to build one but if I do I will want the money I spend to reflect in the price. But this will then price me out of the "first time buyers" price bracket.
I don't have enough for a deposit for another place, unless I can release a bit of equity in the current property to put towards another.....equity that I don't have!
I could sell up and move to a really crap area but I really don't fancy that!
Luckily I'm earning about 15k a year more now so eventually I can borrow more.
15k a year! and you got a morgage! i cant even get a credit card n i earn £35!!! but my age lets me down i guess, but i have finance and bills all in my name! :undecided:
-
Just as I thought really. I didn't buy unwisely but the Market was at it's peak which nobody knew at the time. Also I only put down a 8k deposit. Now you need a massive deposit and there is no way I could afford a 25-30k down payment.
It's frustrating as I want a garage! I have the space to build one but if I do I will want the money I spend to reflect in the price. But this will then price me out of the "first time buyers" price bracket.
I don't have enough for a deposit for another place, unless I can release a bit of equity in the current property to put towards another.....equity that I don't have!
I could sell up and move to a really crap area but I really don't fancy that!
Luckily I'm earning about 15k a year more now so eventually I can borrow more.
15k a year! and you got a morgage! i cant even get a credit card n i earn £35!!! but my age lets me down i guess, but i have finance and bills all in my name! :undecided:
read it again including the bold :wink: how cant you not get a credit card? the banks threw one at me as soon as I turned 18 :lipsrsealed:
-
ooooh lol! skim reading never pays off :laugh: lol i duno its cause iv only allpied for the tesco one, for points haha!! i dont really wana get sh!t loads of intrest... :rolleyes:
-
ooooh lol! skim reading never pays off :laugh: lol i duno its cause iv only allpied for the tesco one, for points haha!! i dont really wana get sh!t loads of intrest... :rolleyes:
Don't know much about Credit cards do you??
-
Anyone work with Mortgages or had much experience with them?
Basically we are looking to move but our place is worth less than when we bought it. Probably about 10k less. We are looking to buy a new place but it will cost more money. Currently we are fixed at 6% but looking to track base rate at the end of the year.
My question is are we realistically going to be able to borrow more money if we are in negative equity? If we bought a place to make money on, could we cancel out our equity that way?
Cheers :)
In short. NO.
You bought unwisely :wink:
Can't really say he bought "unwisely" as you never know when the market is going to crash or stabalise etc.. I am sort of in the same boat, split up with my fiancee, wanted to sell up, house is 10k down, so I took the place on myself, gave her 10k and started to rent the place out, financially i am in a bit of a pickle at the moment as I needed to take a loan on to buy her out.. but now i have someone in the place, got a trickle of money coming in so all is ok.
Have you thought about renting it and looking to buy another?
true, no-one knew the crash was coming?
shouldn`t your ex have paid you £5k to take the house on? as really your now £20k down?
She had the 6k to put down as the deposit for the house, I said that if we ever split up she could have that back.. We couldn't afford to sell the house so I said the next option was for one of us to take it on, or wait 18mnths.. We spoke to financial advisors who said the market was dropped at 1% a month for the foreseeable future, decided we could not hold on for the end of the fixed term and then look to sell as it was too risky.. So I took it on.. I offered her 10 to allow her a deposit for a new place. We didn't split on bad terms, just wanted different things from life.. I wanted to stay in the RAF, she hated me being away...
-
No I don't, might have a research tonight :)
-
Just as I thought really. I didn't buy unwisely but the Market was at it's peak which nobody knew at the time. Also I only put down a 8k deposit. Now you need a massive deposit and there is no way I could afford a 25-30k down payment.
It's frustrating as I want a garage! I have the space to build one but if I do I will want the money I spend to reflect in the price. But this will then price me out of the "first time buyers" price bracket.
I don't have enough for a deposit for another place, unless I can release a bit of equity in the current property to put towards another.....equity that I don't have!
I could sell up and move to a really crap area but I really don't fancy that!
Luckily I'm earning about 15k a year more now so eventually I can borrow more.
Join the club! When we bought ours it was supposed to be a three year stop gap before moving somewhere else with a garage and another bedroom. But we're still there and I've got the itch to move so badly. Sadly we simply cannot afford to, while we aren't in negative equity we wouldn't raise enough of a deposit from a sale to move anywhere any bigger, unless it was a crap area :sad:
But I do realise we're lucky to have our own place at all even if it's not ideal.
-
Anyone work with Mortgages or had much experience with them?
Kind of.
Where do you live?
-
Surely this totally depends on your loan to value and if you've borrowed to your max based on your salary. The value of your current house doesn't really factor unless you have max'd out on what you can borrow and had 95% mortgage and are definitely in negative equity.
-
some mortgage lenders allow you to transfer your mortgage, might be of interest, just go chat to your mortgage people and see what your options are. Cost them up, see what you want to do and be weary that Mortgage people try to make money out of you.
-
Anyone work with Mortgages or had much experience with them?
Kind of.
Where do you live?
We live in Newquay, Cornwall mate. The area we live in is perfect and to be honest the place across the street is just what I want but it's about 30k more than ours.
We got a 95% mortgage 4 years ago it's due to run out in January. So we will look to re-mortgage then. Hopefully our house will rise in value before then, hopefully the interest rate will not :)
-
I don't see why you can't move house even if you are in negative equity. So long your income allows you enough funds to borrow what the new house is worth, you'll have to factor in whatever extra you need on top of what you sell you current house for. For example in very basic terms:
New house value: £130k
Current house value: £90k
About borrowed initially: £100k
Extra amount you need to borrow for new house: £40k
Total borrowed: £140k (provided your income allows this)
Problem is not many lenders at the moment want borrowers with high Loan To Value % such as your 95% so will most likely require you to put a bigger deposit up front to reduce the LTV as you do not have any equity in the existing property you will need to start saving. So in effect if you use the figure above you'd want to get that £140k borrowed down to about £120k by saving up a deposit of £20k, then the banks might be interested.
-
Reason I asked where you live is a family member if a proper Independent Financial Advisor, but you are too far away really.
-
I don't see why you can't move house even if you are in negative equity. So long your income allows you enough funds to borrow what the new house is worth, you'll have to factor in whatever extra you need on top of what you sell you current house for. For example in very basic terms:
New house value: £130k
Current house value: £90k
About borrowed initially: £100k
Extra amount you need to borrow for new house: £40k
Total borrowed: £140k (provided your income allows this)
Problem is not many lenders at the moment want borrowers with high Loan To Value % such as your 95% so will most likely require you to put a bigger deposit up front to reduce the LTV as you do not have any equity in the existing property you will need to start saving. So in effect if you use the figure above you'd want to get that £140k borrowed down to about £120k by saving up a deposit of £20k, then the banks might be interested.
Mortgages are not just about ability to pay it's also about the risk to the lender, so even if someone can afford to cover 140k salary wise, a lender is not going to lend that money secured against a house that's worth 130k. Yes you can move if in negative equity if you have the deposit to cover the new house etc, but I think that's the whole point, the OP doesn't have that as he mentioned earlier. The above just proves the very reason why you will have trouble moving when in negative equity. :wink:
-
have you actually rang up your mortgage lender to find out? im in the middle of doin the same thing right now, only losing 2k on our flat if it sells at the asking price but i see it as the best oppertunity we have right now of moving into a house.
im with northern rock (nram now) and the only thing theyve said is they will let me lose money on the flat sale and swap it to an unsecured loan if the house we buy is less than the balance remaining.
if your in no hurry to move then get saving, even a few quid helps