Want to Sell house but bank want whats outstanding within 10yrs

S

shamrock1

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If any of you have had success in communicating with a bank I would like your thoughts on our situation.

we are letting a house out which is in negative equity by about 80,000. We have decided we would try to sell the house as we are currently on interest only option and even with this the rent is not covering the mortage. And we are putting about 500 towards it each month.

We are willing to pay back what lefts on the mortage over the life of the mortgage but the bank have said it needs to be paid within 10years. There is no way we can afford to pay this. This would be the equivlent of paying the full mortgage every month.

We have our own mortgage for our home to pay aswell and that is in severe neg equity aswell so there is no way we can pay both.

Would really appriciate hearing if anyone came to an arrangement with the banks.
 
Most banks agree to be paid the mortgage shortfall over the remaining term of the mortgage at the mortgage interest rate. It is odd that they want it repaid over a shorter period.

Which bank is it? It's ok to name them, if you don't mind doing so.

The reality is that the bank can't get blood out of a stone. You could agree just to get the property sold, and then as long as you are paying what you can, the bank is unlikely to take any further action.

Would you like to give us the full figures. It's a bit unusualy, that with negative equity of €80,000, you are still paying €6,000 a year more in interest over the rent. That seems very high. If you have your figures wrong, it may make more sense to hold onto the investment.
 
Wasnt sure about naming the bank. Its KBC.

Mortgage is for 220K
we have been told we might get 140k if lucky

The money we are putting towards it also takes into account household charge, etc

We would really like to just get rid of it because if they dont allow us to keep it interest only there is no hope of us being able to make the payments.

If the bank has said 10 years has anyone had any luck getting this extended?
 
Mortgage is for 220K
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And we are putting about 500 towards it each month.
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That is why I asked for the figures. €220k@ 4.25% = €9,350 interest which is say, €800 a month. Allow a further €100 per month in expenses gives €900 per month.

You are putting €500 a month towards it which means you are getting rent of €400 per month. Is this correct? It seems like very low rent even for a property worth €140k.

Brendan
 
Hi Bronte

The worries of banks in these situations is that the borrowers will just give up after a few years. So they try to get as much as possible as quickly as possible.

Brendan
 
Brendan Burgess said:
The worries of banks in these situations is that the borrowers will just give up after a few years.
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But it would be silly of a borrower to give up, as if they can afford it a bank can go after them with an instalment order? Or put a judgment mortgage on the PPR when it's out of NE.

Surely it's a question of affordability and lifestyle. If the banks think people are playing with figures and overstating, the bank thinks they can repay quicker. In any case it's better to repay earlier if possible as you pay less in interest.
 
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