Negative Equity: A Success Story
Negativeequity has been an emotional drain on thousands of Northern Ireland families in recent years.
In many cases, people who bought at the peak of the property-price surge in the mid-2000s now find themselves occupying a home which is worth tens of thousands of pounds less than they paid for it.
Trying to sell a home in negative equity is well-nigh impossible for anyone who does not fully grasp all of what that entails, all of what may be at stake and all of what the law demands.For many of the 68,000 Northern Ireland households, living with the effects of negative equity is a daily-recurring nightmare.It’s fine if you are able to pay your mortgage, are happy with your home and have neither the need nor the desire to sell it. To any in that position, negative equity is not an issue.
But what if you need to move as a result of a change in your circumstances? It may be that the house you bought back then is no longer big enough following the arrival of children. Alternatively, with your children having grown up and moved out, your house now is too big.
It could be that you have divorced or are in the process of divorcing, for which reason the house of which you and your spouse are co-owners now has to be sold so that you can go your separate ways.It may be that death has robbed you of your wife or husband, so the house you once shared no longer is suitable.Or perhaps you have lost your job, or have seen your income plummet as a result of shorter working hours, leaving you struggling to meet monthly mortgage repayments. Now there is talk of an interest rate rise and you know that if and when that materialises, you are not going to be able to cope.
Whatever the exact reason, whatever your particular circumstances, reality is that you need to sell. The problem is that, as a result of negative equity, you know there is no way you will be able to pay off your outstanding mortgage, never mind have money left over to invest in a new home.Thousands of Northern Ireland people feel that way, face that problem, fight that battle. It probably isn’t of much consolation to learn that.
| So here is the totally true, completely genuine, 100% bona fide, heart-warming story from County Armagh which might help. Hopefully you will take encouragement from it, because it's about people just like you.
It’s the tale of an Armagh couple who wrestled with negative equity for a long time before coming to the conclusion that they could not solve it themselves.
‘I can confirm the property is secure, vacant and unfurnished. Should there be any contents remaining, these will be disposed of by you.’
By this stage they had sought help (via Negative Equity NI). As a result, they were steered through the minefield by experts who were able to negotiate, on their behalf, with the bank, ultimately leading to a suitable compromise.
Describing what things had been like prior to reaching the decision to seek assistance, Jennifer (not her real name) said:
We lived week by week and under immense pressure of how we were going to manage long-term in a home that wasn’t meeting our needs.
Invited to share her experience after calling for help, she wrote:
We found Negative Equity to be an efficient, professional and helpful service. All staff with whom we dealt with were friendly and learned in their role and empathetic to our cause.
And the effect of her case now having been settled? Thankfully, there is a happy ending.
This means the start of a new life, she said. We are settled in our new home and more relaxed in ourselves.
When asked if, based on her personal experience, she would advise others in a comparable situation to do what she did, she replied: I would suggest this service to anyone in the same position as ourselves.
We have been positive in our communication of your service to everybody we have come across since commencing ourselves.
Jennifer’s endorsement is based on a number of irrefutable facts.Her first consultation was completely free of charge. And when, at the end of that initial meeting, it was obvious she could be helped which led to her case being taken up from that moment onwards it was researched, handled and overseen by experts who know the marketplace and the law, as well as understanding the minds of lenders.
That is the sort of insight, knowledge and experience that ordinary punters just don’t possess. The term expert’ is earned from others; one does not confer it on oneself.
From start to finish she had the security of knowing that those acting for her were Financial Conduct Authority-controlled – fully regulated and subject to stringent checks regarding their knowledge, integrity, responsibility and performance record.To this she was able to add the safeguard of a wholly verifiable success rate in dealing with others’ negative equity issues.The service included her negotiators providing a buffer between Jennifer and her creditors. Throughout the process it was these negotiators who dealt with the creditors, sparing her the ordeal and trauma of having to do so.While that meant she was protected, it did not mean she was kept in the dark or excluded from any of what was going on. That is because she was able to monitor her case using her representatives’ web portal to which she had 24-hour access via her personal computer.
If you are in a similar situation to Jennifer, or you would like to speak to one of our team, please contact us today.
How is home equity calculated?
Home equity is calculated by subtracting the amount you still owe on your mortgage from the current market value of your home.
Can you have negative equity?
Yes. With standard loans, your home equity will increase over time. With negative-amortizing loans — a loan with monthly payments less than the interest rates — your equity decreases over time as your owed balance increases.