Hi Bella and welcome to the trust deed forum.

It's certainly understandable that you would like more space and a more convenient location for your home.

You may be able to sell your home, but that's something you'll need to work with your trust deed company on. I'm sure they will not want this to happen unless, as you say, you remain in a position to make the existing trust deed payment each month.

Any surplus from the sale of a home would almost certainly have to be paid into the trust deed.
Your trust deed company and mortgage lender are unlikely to allow a sale at a loss I would think.

Hi Bella

TDA is correct, the mortgage company wouldn't authorise the sale unless it paid off the mortgage and costs. The Trustee would not get involved as he would need to agree and sign the disposition and could be laible for any shortfall.

From what you say, there are 2 scenarios. Stay put and see how the market recovers or walk away from the property. If this is repossessed, any shortfall would rank as a claim. This is not an ideal scenario as the reason for change is more comfort than financial.

Mark

Thanks for the responses.
I understand that at the moment our reason for wanting to move is more comfort than financial necessity but we do have concerns about the possible rise in interest rates too. We are currently on a variable rate which is still quite high despite the Bank of Englands rate only being 0.5%. Our worry is that our mortgage payments may increase significantly should the rates get put up as most people are saying is likely to happen this year. I suppose that is just a case of wait and see?
Were we able to get someone to rent our property would this cause any kind of conflict? In other words they would cover the cost of our mortgage payments/rent payments to allow us to move? Obviously we wouldn't be profiting from this so our incomings and outgoings would remain more or less the same.

Hi Bella,

I'd assume that this would simply be a change of circumstances that you'd notify your trust deed company about. Assuming your ability to make your trust deed payment is unaffected I cannot see any issue with this at all. If your financial position in any way improved as a result of this your trust deed payment would be likely to increase.

Technically you should also change your mortgage arrangement to be on a "buy to let" basis, and speak to your home insurer, if you take this path. The decision whether to do this is up to you, but a failure to do so exposes you to possible problems with your home insurance and also retrospective claims for increased payments from the mortgage lender if they later found out that the home had been rented out.

A potential rise in mortgage rates is a worry for millions of people at the moment, and especially for anyone living to a tight or restricted budget. In fact eight million mortgages in the UK are likely to increase in cost when interest rates do eventually start to increase.

This will be an issue for many people who are currently in trust deeds, though mechanisms for making adjustments to payments do exist where there is a substantial change in circumstances.

Hi Bella

I can't imagine that your Trustee would have a problem with this, as long as it didn't affect your Trust Deed payment.

You may also have problems changing your mortgage arrangement to a 'buy to let', I think it depends on the lender. I would however persevere with this, if they say no in the first instance. It happened to someone I know and they just kept at the lender who eventually gave in. I definitely wouldn't hide it from your lender though!

Julie

Thanks for the help, greatly appreciated!