Property Rescue Blog

We sometimes forget how much cash is tied up in your home. Releasing this cash could prevent repossession and aid some financial problems you are facing. It is all well and good relying on the value of your house to go towards a bigger and better home – if you can afford it. In the current economic crisis and the struggling property market, it is no shame to admit that your current home is presently beyond your means. So why continue struggling to pay the mortgage payments, and interest payments alike which you cannot afford. House repossession is a very real possibility in this situation, one which could be avoided. Selling your house, to either move in to the rental market, or to downsize could be the answer you are looking for.

Does it really matter how many bedrooms you have? How many guest rooms you have? If you have that landscaped garden you were always after? Or is it better to go to bed at night knowing that you can afford to pay the bills to live in your home, even if it is slightly less modest.

Releasing the equity in your home can stop repossession, and allow you to use some of the money to provide a smaller property. Alternatively, releasing the equity could provide suitable funds for various schemes, including sell and rent back, sell to rent, or simply to sell outright.

With a sell and rent back scheme, the equity can be released from your home. You can ignore the added problems of moving, and you can remain in the property that you have made home. Furthermore, the speed at which such a scheme can operate is much more efficient as there is no searching for a new property, waiting and hoping for a genuine buyer for your property.

In this scenario, although the rental fees may be slightly greater than the mortgage fees, they will be short term, and the lump sum of equity will be used to pay off debts, or can sit in the bank counting the interest.

This works in a similar way to selling your property to move in to the rental market, as the equity released from your home can be used to help finance other ventures, pay off debts, or be used as a deposit on a new home.

A major re-occurring problem is the fixed-rate mortgages coming to the end of their term. Which as a result can greatly increase mortgage payments practically over night. The monthly costings are completely out of proportion, and if your salary cannot absorb the added charge, then you can very quickly gather up debt.

This is also apparent in interest only mortgages. In these instances the property is effectively never yours, so an advantage to watching property prices rise is to release the equity in the property. Thus reaping the rewards of an increase in value, and either re-mortgaging or renting the property back – either way, you can feel those financial strings pulling a little less, and prevent any form of repossession.