Purchased a house in 2006. Relationship with partner broke down after 12 months and I took on the mortgage in my sole name. At the time the lender allowed my 6.5 times loan to income!! Fast forward to now I want to sell the property and get a smaller house . We are in negative equity and I thought I would be able to approach the bank for a negative equity trade down. All was fine until I encountered the Mortgage Credit Directive. Both my husband and I are paid in sterling and although the bank are happy to accept our current monthly payments they will not grant us a mortgage on a new property due to foreign currency income. Can’t switch mortgage to alternate bank due to negative equity. The house is on the market at present for €300k and we have secured an offer of €285. We have seen a property we are interested in for €150k. We can pay the negative equity balance from savings but are short on deposit for new property. Overall we want to reduce our debt by almost 50% but seems mad that we are not allowed to do this. We have perfect credit history with no arrears, both in full time employment earning £50k each. Any advice as to what we can do?