Urghh stuck and nobody offering any advice

[workiskillingme]

So when we got our mortgage in 2006 we needed to borrow a bit more with another loan from the same building society. Some how this loan got separated from the main part of the mortgage payment and we were paying x amount for that loan and x amount for the mortgage. Every few months they then said we need to pay more etc and we needed to do an income and expenditure then they would tell us what to pay. Fine. Fast forward to now they didn't alter our mortgage payment like they said they were going to and send us a default notice saying it's gone unpaid despite them saying the amount would be added to our existing mortgage payment .
The dilemma is we need desperately another bedroom for our son. If we can't borrow money to either move or get an extension we are screwed. I spoke to a financial adviser who was usually and gave no advice at all
What would people advise in this situation?
Thanks in advance

You presumably have paperwork, evidencing a) what they told you to pay and b) that you paid.

You are approaching this kind of chaotically. You need to be systematic.

Spend some time writing a detailed spreadsheet of every payment you were asked to make and every payment you did make. Were there any differences between what you were asked to pay and what you did pay?

I think it would be worth you going to Citizens Advice Bureau. I have a friend who volunteers there and they help people get to the bottom of this type of problem all the time. I think you really need to get to the bottom of what has happened, who is responsible and what this means for your finances and from your posts it doesn’t sound like you are really clear on that. Until you are clear on your current situation I don’t think you should make any decisions re moving house.

Which bank is this with?

Given how messy all this sounds, it might be worth contacting one of the money pages in the papers and asking for their help

but before you do that, you need to speak to the bank and ask for back copies of ALL your annual statements, and gather up all paperwork you have relating to the loan and mortgage

www.thisismoney.co.uk/money/columnist-1066277/Tony-Hazell-Daily-Mail.html

www.telegraph.co.uk/money/katie-investigates/katie-morley-investigates-contact-form/

www.theguardian.com/money/series/bachelor-and-brignall-consumer-champions

So you haven’t remortgaged since 2006? You must have been paying way over the odds for most of the duration of the mortgage, because rates fell very sharply in 2008 and remained very low after that.

Not necessarily. We had a tracker mortgage from 2006 at .5% above base for the remaining term of the mortgage. (Now paid off thank goodness)

Variables will have generally been good over the last decade. People fix not because it's cheaper necessarily, but because it means you have certainty about your payments.

I had a variable rate mortgage in 2008 amd remember my payments plummeting. At one point they were £100 a month (small mortgage). I felt rich!

Some how this loan got separated from the main part of the mortgage payment and we were paying x amount for that loan and x amount for the mortgage. Every few months they then said we need to pay more etc and we needed to do an income and expenditure then they would tell us what to pay

This sounds very strange, you need to gather all your paperwork and talk to a debt advice charity like Stepchange to work out what has been going on and identify possible solutions to getting on a better financial footing.

Agree with this.

Take a day and start at 8am and devote the entire day to locating all your paperwork and making calls to straighten this out. No distractions. You need a greater sense of urgency.

Do not chase more loans or lose your family home. The bedroom situation won't last forever and teen will manage.

What is your and partner's job situation?

We both work I've been employed in the same organisation since 2012 he is self employed

Rent yours out and rent something bigger for yourself.

OP I'm a mortgage adviser - you need to make a complaint to the building society and reference as much paperwork as possible. There are a multitude of steps financial institutions have to follow before they can apply a default on your credit file, they can't do it without making you aware of arrears etc. The BSoc will have 8 weeks to consider the complaint and you can then refer this to the Financial Ombudsman Service for free.

Is the loan itself secured against your property? If it's an unsecured loan that's defaulted then you can arrange a repayment plan to clear the balance in time. This will affect your credit report but not as much as leaving it unpaid. If the loan is secured it's more complicated.

No it's unsecured thankfully

@workiskillingme NO. do NOT give up your mortgage. Renting is much more expensive and you're highly unlikely to get another mortgage.

Do NOT do this.

What happened to the £3K refund? That would have insulated and decorated the conservatory. Or paid for creative stud walking in your bedroom to split it whilst you and husband move into the smaller of the two bedrooms.

Thread search suggests both your children are boys. So of course they can share.
My cousin has 4 girls and they share: 23 + 15, 19+17. That’s just life when you choose to have more kids than bedrooms 🤷🏻‍♀️
It’s crazy to get yourself into more debt.

OP I've no advice on the financial side but of course your sons can share a room. I have ten year old and three year old DDs sharing and even though we could actually afford it I'm not moving house as we are very happy where we are. It's not something we plan to take on extra debt for. Lots of children share bedrooms with siblings, of all the things that might ruin your life and cause long term trauma sharing a room with your brother is not one of them.

Could you rent out your home and then rent a bigger one for you? A friend did that years ago until the housing market settled and they could sell their smaller home.

If it’s unsecured, it’s not part of the mortgage…

you need to dig out that paperwork and get to the bottom of this…

Your DMP taught you nothing then?

This is not a good plan. It will cost more, which the OP can't actually afford from the sound of it.

Read this website about what a nightmare the rental sector is, I was in it for 12 years before buying and I wouldn't go back if I had any other choice. I think the conservatory might be a shout, if you make it private enough, it's silly to have downstairs space underused when a teen needs a bedroom. I offered one of mine a downstairs room, they chose to remain where they were in the end but choices are possible. The advice you have had on the loan is already excellent.

If it's anything like my conservatory it would cook the poor child every time the sun shone. A lot of conservatories get dangerously hot - I wouldn't let a pet sleep in mine let alone a child. Better to just share a proper bedroom.

We could just get a new roof to make it more suitable for the different weathers

If there's a 16 year old who need somewhere to sleep, presumably offering a space downstairs, either on a sofa bed or in the conservatory in winter would provide a short-term solution while you think of a longer term solution. Thing is, all things like extensions, loft conversions are really expensive, prices have shot up recently and all my friends who want them have had to wait a long time or had difficulty finding someone to do them. Personally, I'd look to repurpose the space you have downstairs as an obvious temporary solution and cost up some of the others.

I would not go into rental, you could end up moving after six months.

you need to track back the history of this loan, and find paperwork relating to this joint payment, it sounds a little odd if part of it was mortgage and part of it was unsecured loan, so you need to show what you were doing til recently to evidence that it is their mistake, and then I would put in a complaint as above.