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Loan through house

(9 Posts)
pinknails Thu 16-Mar-17 21:38:31

Right first I am in Scotland.
I recently inherited a mortgage free flat worth £110000.
I have about £10-12k debt which I'd hoped to pay off using capital in home either via a secured loan or equity release.
Unfortunately secured loans require a mortgage and I am too young for equity release. Reluctant to sell property.
Any ideas or others ways I can get the capital.
Credit rating poor.

Petpank Thu 16-Mar-17 21:52:53

Pink - can you pay off a little each month to start reducing the debt?

Then rent out the property and put the proceeds of the rental to the debt also?

hilbil21 Thu 16-Mar-17 21:54:37

Can you not do a little remortgage type? We have just done similar on an inherited property for 25k

nannynick Fri 17-Mar-17 00:23:01

Rent out the flat and use most of that income plus some of your existing income to pay off the debt?

Are you able to live in the flat? Do you currently live somewhere that you own, or are renting?

pinknails Fri 17-Mar-17 07:20:07

Thanks for all suggestions x

Happyfeet1972 Fri 17-Mar-17 15:03:31

I'd suggest same as hil. You'd be able to get a pretty decent interest rate at the moment especially with that LTV.

AreWeThereYet000 Fri 17-Mar-17 15:12:24

You can't remortgage (that's moving a mortgage from one company to another) - you could look at a capital raise (securing money on a mortgage free house - classed as a type of mortgage) however it would be subject to a credit search like the majority of lending so may not be successful if you have a poor credit rating - however if you create an Experian account you can 'credit match' so without affecting you Experian can recommend lenders (if there is any) likely to accept you based on your report.

Options I can think of;
1. As PP have suggested, rent out the property and use the income to repay your debt.
2. Sell the property ( Yes I did read your reluctant but it is an option)
3. Do you have a family member that could take out an unsecured loan in their name and you could either set the direct debit up to come from your account, or you could set up a direct debit to their account to cover the payment?

BarbaraofSeville Sun 19-Mar-17 07:58:48

Have you had advice on your debt and is the amount going down? How did you get into debt? A one off issue or general overspending? What's your current living circumstances? Mortgaged/rented property etc?

If you don't want to sell the inherited property are you planning to rent it out or something else? if you put the e rental income towards your debts, you should be able to pay them back in no time unless the interest rate is really high. It might be worth talking to a broker about a BTL mortgage if the interest rate would be lower than the rate on your debt. However the minimum amount is usually £25-30k but if you get a mortgage that allows unlimited overpayments you could pay off your debts, and pay the excess straight back off the mortgage.

Grandadnow3 Sun 19-Mar-17 20:20:48

Message deleted by MNHQ. Here's a link to our Talk Guidelines.

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