Behind on Mortgage Payments? Options to Sell Your House in London
Falling behind on your mortgage can be stressful, but if you’re in London, there are several options for selling your house quickly to avoid further financial difficulties, including repossession. Whether you want to clear your debt, downsize, or release equity, selling your home might be the best way to regain control of your finances.
This guide outlines the different routes you can take if you’re behind on your mortgage, the benefits and risks of each option, and how Fraser Bond can assist you in selling your house fast.
1. Sell Your House on the Open Market
One of the most straightforward options is to sell your home on the open market. If you have equity in your property, selling it can help you pay off your mortgage and potentially leave you with funds to settle other debts or start fresh.
- Pros: You have the potential to get market value for your home, which may help you clear your mortgage and any arrears.
- Cons: The process can be slow, with the average time to sell a property in London being several months. If you're already facing financial difficulties, this might not be fast enough to prevent further issues, such as repossession.
- How Fraser Bond can help: Fraser Bond can help market your property effectively to attract serious buyers and ensure a fast, smooth sale process. Our experienced estate agents can also assist in negotiating offers to ensure you get the best possible deal within your time frame.
2. Quick House Sale Companies
For homeowners facing imminent financial trouble, a quick house sale company can be an attractive option. These companies specialize in buying properties quickly—sometimes within just a few weeks or even days—allowing you to sell your home fast and clear your mortgage debt.
- Pros: These companies offer speed. You can avoid repossession and the stress of missed payments. Sales are typically made in cash, which eliminates delays from mortgage approvals.
- Cons: The downside is that you’ll often have to sell your home at below-market value. Quick sale companies typically offer 70% to 85% of your home's value, so you may lose out financially.
- How Fraser Bond can help: If you want to explore this option, Fraser Bond can connect you with reputable companies and advise you on the best deals, ensuring transparency and protecting your interests.
3. Sell Through an Auction
Another fast way to sell your house if you’re behind on mortgage payments is to put it up for sale at an auction. Auctions can generate quick interest and competition among buyers, particularly if your property is priced attractively.
- Pros: Auctions are fast and have a set timeline for sale completion—typically 28 days from the auction date. This allows you to get a quick sale and avoid further arrears or legal action.
- Cons: The final sale price is not guaranteed, and there’s a risk that the property could sell for less than its market value. If there is little interest on auction day, you might end up with a lower offer than expected.
- How Fraser Bond can help: We can guide you through the auction process, including preparing your home for sale and setting a realistic reserve price to ensure you get the best result possible.
4. Rent Out Your Home (Sale and Rent Back Schemes)
If you want to stay in your home but are struggling with mortgage payments, a sale and rent back scheme allows you to sell your house to a company or investor, who then rents it back to you. This can give you immediate cash to pay off your mortgage while allowing you to remain in the property as a tenant.
- Pros: You can stay in your home, avoid moving costs, and resolve your mortgage issues with a quick sale.
- Cons: You’ll lose ownership of your home, and these schemes can sometimes lead to high rental rates. In some cases, you may only be able to stay for a short period before being asked to vacate.
- How Fraser Bond can help: While sale and rent back schemes are less common now due to strict regulations, Fraser Bond can advise you on alternatives or connect you with trusted investors offering such options.
5. Negotiate a Short Sale with Your Lender
A short sale is when you sell your property for less than the outstanding mortgage balance with the lender’s permission. This can be a good option if your home’s value has dropped below your mortgage balance, and you need to sell quickly to avoid repossession.
- Pros: You can avoid repossession and limit the damage to your credit score. A short sale may also leave you in a better financial position than a forced sale by the lender.
- Cons: Short sales require lender approval, which can be a lengthy process. You may still be liable for the remaining debt if the property sells for less than what you owe.
- How Fraser Bond can help: We can help you manage the short sale process, working with your lender to gain approval and market your property to ensure it sells quickly at a reasonable price.
6. Voluntary Repossession (Last Resort)
If no other options are viable and you're facing insurmountable financial difficulties, voluntary repossession may be the last resort. This means surrendering the property to your mortgage lender, who will then sell it to recover the debt.
- Pros: You avoid the legal and financial stress of forced repossession, and it may give you time to find alternative accommodation.
- Cons: The lender may sell the property at below-market value, and if the sale doesn’t cover your mortgage, you will still be responsible for the remaining debt. This also significantly affects your credit rating.
- How Fraser Bond can help: Before considering this drastic step, consult Fraser Bond to explore all other possible sale options. We may be able to help you sell quickly without resorting to repossession.
7. Downsizing to a More Affordable Property
If your financial struggles stem from high mortgage payments, one solution is to downsize to a smaller, more affordable property. Selling your current home and purchasing or renting a cheaper property can reduce your mortgage or rental payments and help you regain control of your finances.
- Pros: Downsizing can provide the cash needed to settle debts and secure more manageable housing costs moving forward.
- Cons: The downside is the potential emotional strain of moving from a larger, potentially cherished property.
- How Fraser Bond can help: We can assist you in selling your current property quickly and finding a new, more affordable home that suits your budget and needs.
Conclusion
If you’re behind on your mortgage payments in London, there are several options available to help you sell your home and avoid repossession or further financial damage. From selling on the open market to using quick sale companies or auctions, each method has its pros and cons.
At Fraser Bond, we specialize in helping homeowners sell their properties quickly and at the best possible price, offering expert guidance every step of the way. Contact us today to explore your options and get the support you need to navigate this challenging situation.
