How To Sell A House With Negative Equity

Equity is the difference between what you owe on your mortgage and the current value of the property. It can be described as how much of the property you actually own. Negative equity is where the property is worth less than the mortgage remaining.

For example, you buy a property for £150,000 and have a mortgage for £140,000 on the property and it is now worth £120,000. The amount you owe is £140,000 and the property value is now £120,000, therefore if you sold the property at market value you would take £20,000 less than what is remaining on your mortgage. You would have a negative equity of £20,000.

Selling when in negative equity can break your mortgage terms, it can be expensive and should only be considered as a final option if in severe financial difficulty. If you want to sell with negative equity it will be required to get permission from your lender. Your mortgage lender can block a sale if the price is less than the outstanding loan, so it’s worth talking to them to inform them of your decision and current situation so they can understand and potentially help.

It is important to remember if you do get permission to sell your home you will still be liable for any outstanding debts on the property. They are not removed, forgotten about or written off in any way, you will be responsible to pay the remaining negative equity back to your lender.

Other options to get out of negative equity:

  • Home improvements to increase its value
  • Wait for market to improve and sell at a better time
  • Take a loan to cover any shortfall

Once you have informed your lenders of your decision to sell and you have their permission to regain funds through a negative equity sale, the selling process is exactly the same as selling with positive equity.

Preparing To Sell

First impressions really count; it’s important to stage your home well so you can potentially increase its value whilst being more likely to sell. Clean, tidy and remove excessive clutter from the property, and display some fresh flowers. Also the exterior is important to be kept desirable, curb appeal goes a long way and can attract more buyers so keep the windows clean and in good condition while regularly maintaining the front garden and driveway.

When you are ready to sell, you can use a cash buying service like FastCash4Houses; we buy homes for cash in a short period of time. Our reputation is built on our ability to buy homes in weeks rather than months, avoiding any delays and doing so whilst avoiding all fees.

For those looking to sell their home in the quickest, cheapest and most convenient way, then using FastCash4Houses would be the best option. With us, you can sell your property in a quicker time frame with no estate agent or legal fees to pay. To get your free no obligation valuation today and to find out more about how we can help then visit our website at or get in contact with us to speak to a member of our team directly on 01204 294356 or [email protected]. At FastCash4Houses, we want to support you every step of the way as you sell your property.

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