I am getting divorced and having difficulty selling the family home so that I can buy a flat.

Posted on 24 April 2008

I am 41 and getting divorced. The family home is worth £285,000 but is difficult to sell. I have an interest only small mortgage of £1,100 per month as my mum lent us £115,000. I have a new well paid job of £75,000 +pa and need to relocate and hence rent! If I opted to sell my house cheaply (£230,000 approximately) to a company that buys at 20% submarket value, could I absorb the loss of £40,000 or so through a new repayment mortgage with Charcol (i.e. COOP provided fixed for the term) and buy a flat for approx £200,000?

This sounds very complicated.

If you are selling at a reduced price, then you simply will have less equity to move on with.  As you don't tell me the outstanding amount of your mortgage I shall  assume you have at least some equity left after settling it. You would just get a mortgage for however much else you needed to make it to £200,000.

On your salary you could borrow the full 90% of £200,000, so as long as the equity you get out of the sold house is more than £20,000 to be the 10% deposit, you would be fine.

As for the slow sale, this is common to the market at the moment, which is how property values will fall. £230,000 is relatively low, why not market the house at £250,000 for a while?

Best of luck.

Category: Separation or Divorce

 

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