What is negative equity and how does it affect selling your property?

What is negative equity and how does it affect selling your property?

  • What is negative equity and how does it affect selling your property?

    Negative equity property may be a term that some are unfamiliar with. But with uncertainty creeping into a slowing UK housing market, the value of your home becoming less than the value of your mortgage could become a reality.


    The Daily Express is concerned enough to have published a story in the past few days entitled ‘What is negative equity and how does it affect selling your property?

    The article does a great job of conveying what negative equity is and how it comes about. Offering this example, ‘Let’s imagine a property was purchased for £350,000 with a mortgage of £320,000. If now your property is only worth £300,000, you would be in negative equity because your property value is less than your £320,000 mortgage’.

    Meaningful negative equity solution needed
    What the report fails to do is offer readers a meaningful solution to the UK’s potentially looming negative equity problem.

    In the article published 22 June 2018, ‘property expert’ Elliot Castle says “Selling a house in negative equity will be impossible for some, as few people have enough savings to pay the difference in price between their current property and the new property they wish to purchase. Furthermore, it is unlikely that a mortgage lender will allow property owners to change their mortgage when they’re in negative equity.”

    Elliot’s ‘best solution’ to negative equity? “Stay in your current home and slowly chip away at your mortgage and wait for house prices to rise” he advises.

    But what if you can’t simply wait it out? You might already be struggling financially or need to sell because you’ve outgrown your home or are separating from a partner. In cases like these, waiting and hoping house prices will rise in an uncertain and slowing market isn’t really a solution at all.

    That’s where Negative Equity UK step in. If your house is worth less than it’s mortgage, we are your best option and can provide a solution that is meaningful to you because it’s build around your unique situation.

    You don’t need to wait it out
    Contrary to the advice offered in the Daily Express by Elliot Castle, selling a house in negative equity is not impossible. If you’re circumstances mean that you need to sell, we can negotiate with your lender for you (even taking care of the legal aspects of your case) and not only sell your home but arrange a suitable debt write-off that could be worth tens of thousands of pounds. Our average property debt write-off in 2017 exceeded £75,000 per customer.

    We are the only specialist negative equity and property debt company operating in the UK that offers this full range of services, and we are reassuringly authorised and regulated by both the Financial Conduct Authority and Chartered Accountancy Regulatory Board.

    Keeping you informed and removing the stress
    Experience has taught us that negative equity debt is only part of the issue that our clients face. You may also be concerned about the lack of information that is out there about your situation and its impact on your ability to access credit in the future.

    That’s why all Negative Equity UK staff are trained to be non-judgemental and to act in a manner that is compassionate and respectful. We go the extra mile because we want to make a difference. Your dedicated adviser will keep you informed every step of the way and do their upmost to take the stress and worry out of the situation for you. We want to help you move forward in the way that you need too. 

    Contact us today for a free initial consultation



    How we’ve helped previous clients

    We’ve helped hundreds of families move on from negative equity and mortgage debt, and we genuinely want to achieve the best possible outcome for every client we work with. That's why 100% of those who have reviewed our services at reviews.co.uk would recommend Negative Equity UK to others. Here is an independently verified review from a recent customer.

    “We had an interest only mortgage of £170,000 which we took out in 2007. The property market then crashed soon after and our home was then only worth £100,000. The lender would not negotiate a new deal with us, as we were in negative equity, and we were basically stuck even though we were both in well paid employment. Our family had grown and our house was now too small for our needs. In 2015 we approached Negative Equity and they helped us throughout the entire process. They dealt with our lender and sorted out all the legal aspects for us. They were always there for us to ease our worries and answer our endless questions. Two years later we have since sold our house, at a loss, but the debt has been written off. We are now renting a lovely house in the country and free of the debt caused by the property crash. None of this would have been possible without the help of Negative Equity UK. Thank you.”

    Read more Negative Equity UK reviews.


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