Sell with a shortfall or rent out house

B

Busybee01

Guest
i have a dilemma.
I bought a house in 2006 with my now ex partner.

we paid E235000 for the house and took out a loan for E20000 for contents.
we have since parted ways and are in a dilemma as to what to do with the house.
we have placed it on the market and have recieved an offer for E170000 (ex contents) leaving us with a shortfall of E33800.
we have been paying the mortgage as intrest only for the last 2 years (E651 a month)
this is set to rise in 12 months time to (E1300 a month)
plus additional costs for house insurance, life insurance etc.
neither of us are living in the house at present.

I am wondering what my options are as if we sell we will have to pay back E56000 of a shortfall due to other present loans.
should we cut our losses and sell for E170 now (requiring us to procure a personal loan to cover the deficite)
or try to rent the house out (approx 500-600 a month)

is it true that the county council will rent your home on a contract basis? has anyone approached them about this?
is this an advisable course of action or should i consider renting the house out?
what costs will i incur as a result of this?

I would really appreciate advice on this matter
 
If the bank agrees then selling and paying back a personal loan of 56K between you sounds like the better option. Your problem will be to get the bank to agree.

You need to both immediately get the bank to agree to the sale. As you have a buyer speed is of the essence.

Advice to sell now is based on the fact that rent would not cover mortgage, you are a separated couple, you are not experienced at being a landlord, your mortgage has been interest only for 2 years, your mortgage will go to 1300€ in 12 months.

Be aware the some banks have been agreeing to allow house sales in negative equity and continue the 'negative equity' part of the loan to continue at mortgage rates rather than personal loan rates. Probably the worse your financial situation the more likely they are to agree this.
 
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