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When you are worrying about losing your home due to debt or not paying your mortgage and you are desperate to keep hold of it; it might seem counter intuative to think about selling your house.
But, if you have explored all other options with your lenders and cannot realistically repay the loan or meet a payment plan, selling your property yourself is usually a much better option than letting it get repossessed.
It gives you more control over the sale process, potentially allowing you to get a better price for your property, limits the damage to your credit score, and potentially helps you to avoid added debt through fines and legal costs.
In addition, if a forced sale does not recover the total of the money you owe, you can be liable for the debt for a further 12 years.
Key reasons to sell voluntarily instead of facing repossession:
- Higher sale price: When a lender repossesses, they often sell the property quickly at a traditional auction, which may result in a selling price dramatically lower than the property’s value and leaving you with a significant debt even after the property has been sold.
- Control over the sales process: By selling yourself, you can choose the timing and marketing strategy for the sale, potentially attracting more buyers and getting a better deal. However, if your lender has issued with a deadline to repay, not all sales types will be possible due to the unpredictable nature of high street sales. Also you will need to consider the time betwenn agreeing a sale and having the funds deposited in your bank as the process can take longer than lenders allow.
- Choosing your next move: If you are going to lose your home, freeing up any money tied into your property could give you more choice abut how, when and where you move next
- Minimising credit damage: A repossession will severely impact your credit score, making it harder to obtain loans in the future, while a voluntary sale can be managed to minimise the negative impact.
- Potential to avoid further debt: If you sell your house yourself, you may be able to use the proceeds to fully pay off your mortgage and avoid any additional debt to the lender.
How We Can Help
National Residential sells property in 28 days and we make sure our buyers are able to completes in 56 days so we can provide schedules lenders will accept. Plus we have a 95% completion rate.
Sellers normally walk away with 85-90% of the high street sale value and pay no fees or legal costs. Whereas property sold at traditional auction (as will happen if it is repossessed) normally only achieves 70% of the high street sale value and they incur costs, fees and legal fees which are added to the sellers debt.
Once we have a found a seller and they have paid the nonrefundable deposit to secure the sale, we can provide sellers with sufficient equity in their property, an interest free cash advance (to be repaid on completion). With it, we can pay off sellers’ debts so that sellers have more choice about when the sale completes and they leave the property. It can mean the difference between being homeless and having a home to go to when you leave the proerty.
For the best outcome, contact us as soon as all options to come to a feasible agreement with your lender have been exhausted but we can help even if your lender has started proceedings or obtained an eviction order. Speed is crucial, and we can negotiate with creditors to delay or halt proceedings with a guaranteed sale.
Case Study
A seller who had fallen into arrears with their mortgage repayments came to us for help and this is what happened:
- A seller with mortgage arrears of £7,900 contacted us at the end of Oct because they had received notice of a bailiff being appointed to evict them on Nov 12th
- The market value of their property was estimated to be £210-225K and they had outstanding mortgage/loan of £155K
- If they allowed their property to be repossessed and sold at tradional auction, the expected sales price would have been appx £147 – 157 ( 70% minus appx £3K auction fees/listing costs plus £1-2k solicitor costs), meaning the amount raised from auction would not clear their debts and they would be held liable to pay back the outstanding £5K + (est) for 12 years
- A cash buying company had already offered to buy the property directly for £160K
- Instead, the seller accepted a ‘Fixed Price with Zero Fees’ (walk away) offer from us of £190K* (minus our cash advance or any loan secured on the property)* Meaning we would try to sell the property to a 3rd party and our seller would receive £190K if we were successful.
- We collected listing material and listed the property for sale by 7th Nov.
- We proactively advertised the discounted property to chain free buyers who are able to complete in 28 days in our database of 30,000+ buyers and negotiated with interested parties to find buyers who were willing and able to pay a bigger deposit than our normal rates (£7900 rather than £5000).
- We agreed a sale for £205K and our buyer paid the deposit 9th Nov (i.e. just 2 days later).
- We paid the full amount of the deposit paid by our buyer to our independent panel solicitor who arranged an emergency court hearing on Nov 11th to halt the eviction. The court agreed and gave the seller 2 months to complete/repay the loan in full.
- We paid the seller an interest free cash advance of £3,500 to pay: their solicitor’s fees for attending court; the deposit and 1st months rent on a rented property; and her removal costs
- The completion was made slightly more complicated than usual because of the involvment of a Help To Buy company but we liaised with them directly to ensure their needs were met within the timeframe required by the court agreement
- The sale completed in less than 6 weeks and the seller walked away with £20K profit after all loans had been paid
Contact us now using our callback form or 0800 612 8659 (free phone, 24/7) to find out how we can help you sell to avoid being evicted and get the best price for your property.