How To Sell Property To Clear Mortgage Debts

Businessman giving mortgage contract to woman to sign

If you’re having a hard time making your mortgage repayments, you may be thinking of selling your property to clear those mortgage debts. It’s important to realise that you’re not alone. With the cost of borrowing ever on the increase and the monthly payments going up for so many, owning a home isn’t always a feasible option. For finance gurus like Martin Lews, interest-only mortgage products are going to be the real problem as the economic woes of the UK continue. If you find yourself in that situation, selling your property might be the right choice to meet your needs. A situation like that would offer you a lump sum to help pay off what you owe to your lender, and if you have added money left after the sale of your home, it might be possible to use that to pay off your additional debts.

What To Do First

As soon as you realise you can’t handle repayment, mortgage lenders advise there’s one key step to make – contact them. The last thing you want to do is just leave the property and hand the keys back to your mortgage lender. Don’t think for a moment that you’re in a situation where there’s nothing you can do about your overall debts and eviction is your only option. Initially, you’ll want to talk to your mortgage company to see if you can get that payment down. Not all lenders can help, but in some situations, they can come down with that sort of thing. Some mortgage lenders accept benefits, as well as some that offer other programs that can help. You may even what to ask when can you remortgage your home. Remortgaging can help keep your mortgage cost under control and make sure you lower your payment. Often, though, lenders don’t let you know when you qualify. You have to call and ask, “When can I remortgage” to get a straight answer about when you can lower your payment. Mortgage providers can’t all help you lower your mortgage payments, though, in any situation, so you may want to consider switching mortgage options next. There are mortgage providers who have quite a bit to offer in terms of loans. From an interest-free mortgage to a different cheap mortgage that might help you better make your payments, with some shopping, you may be able to find a lender who is willing to help.

If you’ve worked with a few different mortgage providers UK homeowners like you use and you’ve talked with a broker who looks at various loans from the council of mortgage lenders, but switching mortgages just isn’t going to be an option for you or you can’t find someone who offers you a monthly mortgage payment you can afford, and you’re stuck with mortgage costs that are too much for your monthly budget, it may be time to look at doing something completely different.

Selling a House on Mortgage

Fortunately, selling your home, even if you have a mortgage, isn’t too difficult. It’s just a matter of finding the right estate agent, listing your home, and ensuring you get enough money to pay off your mortgage and your mortgage fees. Many people use the term “sell out” meaning that you’re selling your home so that you can pay it off to ensure your debts are covered. If you’re not sure you can wait the three months most homes in the UK sit on the market, don’t worry. There are many cash investors available who can help you sell your home quite quickly. From there, you can simply look at various homes on the open market for rent that will help better fit your budget needs. You may even be able to find rent-to-buy schemes that offer you something in return for your long rent payments.  If you get your home sold quickly and avoid going into foreclosure, it shouldn’t damage your credit. Eventually, when the market looks better and your finances are in order again, you can simply search a term like “mortgage near me” and find a loan and a home that will be better suited to your budget at that time.

What If It’s a Buy to Rent Home?

Even if you can’t afford the payments on your mortgage that you purchased as a second property, you can still sell it and avoid foreclosure. If you had a buy to rennet or a buy-to-sell mortgage, you should be able to fairly quickly sell your home so you get the money you need to pay off your debts.

The Next Steps

If you’re sure selling your home is the right choice for your situation, the next step is to begin finding another place to live then talking to an estate agent about what to expect throughout the process and ensuring that selling your house isn’t going to cost you more than you think it is, thus leaving you with unpaid debts and no home to live in. If that’s going to be the case, it’s imperative that you talk with your lender about the best way to move forward. Some have sold their home with a mortgage, then not made enough to cover the debts they owe. In cases like that, it’s best to talk with cash investors to see if they can go any higher on the sale of your home and give you the speed you need to get out of your house as quickly as possible.

It may also be useful to talk with a free debt consultant to get the advice you need if you are worried about how you’re going to make your next mortgage payment. Often they can point you in the direction of at least a little relief before you miss that next payment.

Worrying about having to sell your home to make sure the debts disappear is a scary situation, but it is possible to do something about it. Start by talking to your lender, then move forward from there.

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