Getting Back On The Property Ladder After Negative Equity
| Overview
If you are one of those trapped in negative equity’s downward spiral, getting help to rescue you from this as quickly as possible has to be your number one priority.
Your next objective is to get back on the property ladder as soon as possible. Not via some hope-for-the-best shot in the dark but instead as a result of safe, structured steps designed to aid your full recovery by enabling you to safeguard or regain your financial status.
In other words, protect or restore your all-important credit-rating. And for that to happen, your recovery has to come about via a proven format verified by a substantial number of genuine case histories of real people from a wide variety of backgrounds.
Whatever your particular circumstances are; they are not unique. So even if you fear that you are the only person who has ever been in your particular situation, rest assured that you are not. Others have come through very similar indeed, in some cases, identical situations and are now firmly back on track having emerged intact from what at one stage had looked like insurmountable problems.
The bottom line is this no-one is beyond help. No-one, whether they are up-sizing, down-sizing, divorced (or divorcing), bereaved. Each of them shares a common problem, namely that they are all trying to pull clear of the negative equity mire and reach a rung on the property ladder.
At this stage run a quick reality check and see how you might score in terms of your current credit-rating. Say there is a £70,000 negative equity noose around your neck. Your head tells you that you aren’t getting out of this, even though you’re a property owner.
| But are you really a property owner or are you merely renting a home from your bank?
If you are in an interest-only mortgage, do you really own your property? Will you EVER own your property? Will property prices double, triple or do whatever else they need to do to get you out of this mess?
Take the case of a married couple who are splitting up but, as things stand, continue to be tied together by the negative equity on the home they shared in better times? Can they, as individuals, get back into the home-ownership market?
Yes, they can, though how long that will take is going to depend on their specific circumstances and on how they want to come out of this process.
The speed at which people are able to return to the property ladder depends on their particular state of affairs and on their lender.
Rather than wasting time and energy on countless google searches which, you hope, will hit on a one-size-fits-all solution to what is your very specific problem, you would be better advised to consult with experts with a proven track record.
In our experience, people who are in negative equity very often are scared to act. They are afraid to take the leap required to fix things. Because they think they’re going to be condemned to spend the rest of their lives living in rented accommodation, they just freeze. But we have helped people through just such circumstances.
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.
| As to how quickly they might resolve things, that really is like asking how long is a piece of string?
There are cases where people can go straight back into home ownership. But there are others where, because of what they have done or not done – before seeking help, their credit-rating is in tatters, so that’s going to have to be repaired. The bottom line is that the sooner they start facing reality, the sooner they start moving forward again.
If you want to find out more about how you can get back on the property ladder after dealing with negative equity, get in touch with a member of the team today!