Would selling house and renting be best option for us

phileasfogg

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Age: 30
Spouse’s/Partner's age: 32

Joint gross income : 76,000 (+ about 15,000 overtime but probably only for this year)

Type of employment: Me: permantent, public servant. Spouse: contract ~6 months remaining (but job prospects look good)

In general are you spending more than you earn or are you saving? Just beginning to start some savings now.

Rough estimate of value of home 299,000
Amount outstanding on your mortgage: 270,000
What interest rate are you paying? . Pay about 1300/month

Other borrowings – car loans/personal loans etc 30,000 (deposit on home): pay 455/month. 20,000 (student loans): 450/month. 31,000 (college loans+wedding loan+furniture for home)-pay 530/month

Do you pay off your full credit card balance each month? No
If not, what is the balance on your credit card? currently 4000 (on introductary interest free offer)

Savings and investments: 2,500

Do you have a pension scheme?

Do you own any investment or other property? no

Ages of children: one on way

Life insurance: 300,000

What specific question do you have or what issues are of concern to you? If we sold house now, we could pay off mortgage and hopefully one of our loans, freeing up about 1700 a month. We should be able to rent a house for about 1200 a month. We do not see ourselves remaining where we are long enough to see out the lowering property prices so feel the sooner we can go the better off we will be. Our long term goal is to buy or build a house close to my family, but this depends on so much-work availability, trying to save etc. We could rent in that area for about 650 /month or even less if needed. Since our loans are high we will not have much flexibility for a long time, but would selling up and putting the difference in rent/mortgage into savings (or paying off other loans) seem like the wisest choice for our long term financial health? Another year of mortgage repayments will not dent our mortgage very much and it is likely that the house will be worth even less by then. Is my thinking correct?
 
Have you considered negative equity ? Who says that you can cover your outstanding mortgage by selling your house ? Would you be able to sell in the current climate ? I think you've left it too late to sell and cover your mortgage
 
We would only sell if we could cover mortgage. We couldn't take on another loan. do you know how to get an honest idea of how much house would actually be likely to get? Houses advertised in our area are in the region of 299,000 to 305,000 but I have no idea how realistic this is. Would I have to get a valuer in? House is only a few years old and would be identical to others in the area.
 
Unfortunately I think the way things are at the moment, you get the house valued and the potential buyer knocks 10% to 20% off this figure and offers it. Not nice but there you go. These things happen in a buyer's market
 
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