Welcome to the forum davyj.

I think that the first conversation you'll need to have will be with your trust deed firm. They'll want to be involved in the sale of your home if you are considering it. You'll want to know what will happen with any equity that's left over after the repayment of your existing mortgage.

We cannot answer the question about your mortgage company I'm afraid. Whether they'd allow you to transfer your existing mortgage to a new property, or whether they'd be prepared to give you a new mortgage, will come down to the precise terms of your current mortgage and/or their current lending criteria. I'd suggest that you speak with them after your trust deed firm so that you know where you stand.

Having had the property valued we are just about breaking even.

We have also been asked to pay £500 towards the house so any equity cannot be taken. Having read some other posts it seems some companies ask for it and some dont. Is this common practice to ask for this money. I also have to pay £230 for my car as i had a loan from my work which has been entered into trust deed. Is this common practice aswell?

Thanks again for your help

Hi davyj.

You may find that the £500 wouldn't stop any equity from having to be paid over to the trust deed. It's there effectively to prevent a revaluation when you reach the final stages of the term of your trust deed. However, a sale during the trust deed which produced a profit might still be considered to be a windfall to be paid over. Worth checking in advance.

You're right that some companies charge this £500 and others do not. Most firms used to, though an increasing number of them (including the three represented on this site by Mark, Kevin and Shona) no longer do.

If the property breaks even on sale how will you pay for all of the costs associated with selling one property and purchasing another? This is a practical consideration rather than being specific to trust deeds.

I'm not sure about the £230 for the car. Could you explain how much the car is worth and how the loan with your company connects to it? Do you know how the £230 was calculated?

The car was valued at below £3000 and i was told if it was over that i could be asked to sell it and pay the money towards the trust deed.

Im not sure how the £230 was calculated i just put my trust in the company dealing with it but im getting a bit anxious now that they are asking for this.

My company basically offered car loans for designated car users at a good rate. Because it was a loan it had to be entered into the trust deed.

As for the £500, we are entering into a 3 year trust deed. If we dont pay the £500 can the house get revalued at the end? How much equity has to be in the house before you pay anything to the creditors?

Sorry for being a bit naive.

Hi again davyj.

The risk of not paying the £500 is that the property will be revalued. If there is equity there the Trustee will be duty-bound to raise it for your creditors one way or another.

There is no fixed minimum amount of equity. We've heard in the forum of some companies making a £5000 allowance to cover selling costs, and other companies that do not do this.

I'm really not sure what that £230 is for I'm afraid. That's not to say that it's necessarily a problem though. I'd suggest you seek clarification from your trust deed firm of what the payment is for.

Hi Davyj

Sorry to come into this so late. It seems strange that you have been asked to pay anything for your car if it has been valued at
£3k. Cars with a value of £3k or less are exempt if they are required for work purposes, or reasonably required for some other reason.