Get out of a mortgage. Ways to reduce debt

good182

I am married father of one with a house in nearly 200k negative equity. Bought the house with my partner in 2008 and paying 1500 pm on the mortgage. Next door neighbours moved in last year and bought the identical house for 180k less. Although this is a pain we are wondering is there any way out of the hole that we are in. Mortgage rates will eventually rise and TRS will dry up in a few years. We are both working so can just about pay the mortgage but after every other bill is taken out we are left with zero disposable income and often topping up the credit cards to make ends meet. I dont know is there any way out especially when we are both working. We are with KBC and dont think they want to know as we can @on paper @ afford to pay the bills.

Toots

Have you approached KBC yet and explained your situation?

28064212

What would have happened if the house didn't fall in value? Let's say it was still worth around the same as you paid for it. What difference would it make? Unless you were planning to sell, what does negative equity matter?

clint_silver

good182 wrote: »

I am married father of one with a house in nearly 200k negative equity. Bought the house with my partner in 2008 and paying 1500 pm on the mortgage. Next door neighbours moved in last year and bought the identical house for 180k less. Although this is a pain we are wondering is there any way out of the hole that we are in. Mortgage rates will eventually rise and TRS will dry up in a few years. We are both working so can just about pay the mortgage but after every other bill is taken out we are left with zero disposable income and often topping up the credit cards to make ends meet. I dont know is there any way out especially when we are both working. We are with KBC and dont think they want to know as we can @on paper @ afford to pay the bills.

The interest rates havent gone up so much over last 5 years that you shouldnt have catered for this when you bought. ie, were you parents when you bought? did you factor in the addition of 1 or subsequent kids and or other life events when you got the mortgage? If not, then you dont really get to complain about it. The last thing they tell you when they give you the mortage is "value may rise or fall, interest rates may rise and fall". did you consider this back then?

Now, none of this helps your financial situation but it might change your thinking on it a little bit as in sure they gave you the money but you asked for it, not their fault if you cant pay it back. Stop blaming others and take the blame on yourself.
If it was me Id ask myself how drastic do you want out of it. either get a better job that keeps you in the lifestyle you want (may involve several years of studies and internships) OR get out altogether. leave the jobs, give the mortgage back to the bank, declare bankrupt, start again, move country, may take 3-4 years, seek legal advice, have an end goal, stick to it, may involve some real hardship short term for freedom long term.

how badly you want out will determine your route, but for piece of mind you need to change your thinking as it will affect your lives in a real negative manner otherwise. be happy with your lot so to speak.

I bought around then too. we changed lifestyle completely so we could still have some nice things. still same car for 8 years

Jonnykitedude

clint_silver wrote: »

The interest rates havent gone up so much over last 5 years that you shouldnt have catered for this when you bought. ie, were you parents when you bought? did you factor in the addition of 1 or subsequent kids and or other life events when you got the mortgage? If not, then you dont really get to complain about it. The last thing they tell you when they give you the mortage is "value may rise or fall, interest rates may rise and fall". did you consider this back then?

What about if the OP has seen a major pay cut since 2008 like many others?!?!

clint_silver

Jonnykitedude wrote: »

What about if the OP has seen a major pay cut since 2008 like many others?!?!

including me.

anyone who has a mortgage must have considered what they would do if
A) there was a job loss
a reduction in salary
C) interest rate increase
D) life event like children or health issues

Now, if you didnt, (and many many people didnt), then you have to address them when they happen, but you don't get to complain about them because if you're stuck in a crippling mortgage for whatever reason, either skill up or get out are your only options, and neither are easy or short lived. As soon as you realize theyre the only options, pick one and be happy with it as your on the path to happiness. the worst thing one can do is sit and wallow and hope for the 6 numbers to come in.

Agreed on the post about neg. equity. best not to think about it unless youre selling.

dricko_lim

Use www.misc.ie to determine your minimum spend every month on bill etc. and then see if you can still pay the €1500. Approach KBC for a split mortgage if you feel the need, fill out a Standard Financial statement and send it in. KBC will offer a max 50/50 split

Jimjay

Also you say how much your neighbours paid for the house but do you know how much they are paying every month for the mortgage?

What kind of mortgage do you have and what rate are you paying?

It is depressing when house is in negative equity. In our estate new buyers are paying about 100k less than what we paid, however, i checked out what the monthly payment would be on a new mortgage if buying now and new buyers would actually be paying the same if not more evey month on their mortage payments than us due to the fact we are on a very low tracker and new rates are no where near it.

D3PO

OP if you have no disposable income left when all the bills are payed then unfortunatly thats nobodies fault except as Clint pointed out yourselves for not planning on a scenario whereby your circumstances would change for the worst.

I dont know you so this may come accross as harsh but first thing you need to do is take a hard look in the mirror and figure out is you have a genuine financial problem or are just unhappy because you want a lifestyle that you cannot afford.

Im amazed at how many times I hear of people complaining in exactly the same way as you only to find

They shop in Tesco
Drive a BMW with the wife having a 4x4
Have sky sports on the TV

and so on and so forth.

If your tight on cash then you need to adjust your budget.

Shop in the likes of Aldi
Drop the all singing all dancing TV package and settle for Saorview
Cancel the mobile phone bill and go ready to go
Do your clothes shopping in pennys instead of fancy brand clothing.
Sell the big car(s) and get something smaller and chaper to run (less tax, less insurance, less fuel costs)
Review your utiLty providors (can you get cheaper gas or electric ? probably if you shop around)
Health insurance ? If you have it can you really afford it if your complaining about cashflow then you probably cant
Life assurance can you get the same cover cheaper ? (I recently switched and dropped My costs from €44 to €17 a month)

and so on and so forth.

Rather than complaining get proactive. Ive yet to find somebody who genuinely complains about their financial pridicament that hasnt got a way of improving them by resetting their expectations as to what they can afford on what money they have. I am confident the above are not things you have done and certainly not all of them.

Stop complaining and start acting.