Need help with mortgage arrears - substantial equity in home

Hi, I'm hoping for some help/advice. I purchased my home over 5 years ago. I currently owe about $323 000 and it's value is about $550 000-$620 000. I started a new business (though quite similar to my old one) and it was a slow start and I fell behind on repayments and bank got nasty quickly. I paid them $20 000 over 4 months to clear arrears as the business is now going well, however I still have about $4500 in arrears plus $5000 in enforcement expenses that need to be cleared by 28 August or else they will take possession. I could lose $200 000+ in equity over $9000.00 if this happens and I'm desperate to find a solution. I had been repaying the bank at $1000/week and could repay a loan at just less than that per week (as I'd also need to keep up mortgage repayments of $1750/month), so could pay it out in 6 months. My credit rating is shot, behind on tax returns and don't have family or close friends that can help. Surely there has to be someone willing to loan that relatively small amount to me given the equity I have in my home? I work as a professional and have been self employed for 18 years. Time is running out for me and I would so appreciate any advice. Thank you.

 

Hope someone can help you out.
What's your business?

 

Hi meinsydney I really hope someone can help you.
There s some great brokers on here , but maybe you need a Solictor too.
I think Terry is with The Loan Experts hope you can contact them.
They sound like good people.
They are Lawyers and finance brokers apparently.

I really hope everything goes well for you mate.

 

If you had a little bit more time, I'd suggest getting hold of an email database and putting on a webinar to pre-sell your services.
Should get the cash pretty quick in advance of you providing the services which buys you some time.
Still possible if absolutely desperate, would be some long nights ahead.

 

I think you need to get your finances sorted out asap including your tax and credit card. I'm surprised the bank hasn't offered you the services of a finance counsellor. If they have one, you should utilise him or her. The situation sounds messy and you need to tidy it up.
Also, not sure why you'd lose the equity - because you owe it on the business loan?

 

Financial hardship with your super?

 

As long as your income can be verified sufficient to qualify for a loan, there are probably non-conforming lenders that can help. The down side is you pay for it in higher rates and some upfront fees. You could probably expect the rates to be in the order of about 2% higher but it is highly dependent on the LVR and some other financial circumstances.

It's not a nice solution but it can be a solution. Once your back on track with your repayments and your credit report has cleaned itself up (which can take some time), you should be able to refinance back to a mainstream lender.

 

Go to a solicitor now.

 

Thank you for all your advice! I actually am a solicitor, but not the type of solicitor that deals with this sort of stuff. I was practising as a barrister for 8 years and returned to being a solicitor 4 years ago and it took some time to build the practise again. I have consulted a solicitor and there have been discussions with the bank's solicitor, but the bank won't budge. I can show my bank statements and show that I gave them steady repayments totalling $20000 between March and June. We can't pre-sell services in my job so a loan is the only option.

 

If someone were to give you a private loan, what security could you offer?

 

The only security I have is the house....there is a large gap between what is owing on it and it's current value.....between $200-$300 000.

 

Have you talked to other banks or a mortgage broker? If you have 200-300K equity and you are a barrister / solicitor with 18 years experience and the business is now going well, there must be some banks or lenders that can help?

 

There's a couple of non conforming products that can do this. As Pete said not cheap, but cheaper than losing the house.

 

Hmm, "behind on tax return" and being self employed or a business owner often means that there might be more debt hiding somewhere.

Good luck with it, but I really don't understand how people that work in (somewhat) related industries can get themselves in situations like this. But then I guess a tradie's house is never finished.

 

Mmm I did feel sorry for you until you told me you were a Solictor

 

The simple option may be to out the house on the market and to use this as a delaying tactic. You could delay possession.

Also you could rent the place out perhaps. There is a requirement for the mortgagee to give a certain amount of notice to a tenant before it takes possession.

But even where you catch up the lender may still want you out so better get the tax returns done asap and see if you can refinance into another lender such as Pepper.

 

You could consider private lending or peer-to-peer lending.

http://www.canstar.com.au/p2p-lending/who-offers-peer-to-peer-lending-in-australia/

For private lending, just don't use anyone with a name like 'Toecutter Smith'.

Seriously though, societyone might be okay - although you might be 'below below average' based on your credit score. Numbers below for a $15k loan.

 

There are also various debt mediation companies who can negotiate for you with the banks some have free initial consultation and/or only pay at the end on their success - probably a % of what they save you.

 

His soul. Oh I forgot, solicitors don't have one

 

If you need it sorted out by 28th August you will need a Private lender.

Forget Society One they are useless for such matters.

Could probably done with capitalised interest over a 2/3 month period allowing you to refinance.

I run a Company National Short Term Loans and this is bread and butter short term lending.