Urgent help! Negative equity

[bakerypots]

If we sell our house below what we owe on the mortgage but can pay it on a credit card (it's only 3k) is that allowed?

[Basicallytired]

That should be okay but why are you in this situation? Are you willing to share?

[bakerypots]

Basically our house is very low value, and we are desperate to leave. Sent it to auction and this is what we've achieved...

[BonnieTellyLass]

Do you absolutely need to sell? For "only" 3k can you not hold out for a sale closer to that amount?

Ultimately it will depend on your provider if they approve it as some may have different regulations but i would think as long as they get their money they wouldnt mind?

[BonnieTellyLass]

ah sorry cross post

[bakerypots]

It's been up for a long time now and this is the closest we've got to what we need (other than something which fell through before it went to auction)

[Sarahlou63]

Worth trying to negotiate with the lender to write off the £3k first. Don't offer up front.

[Tigger03]

Where are you moving to? Do you have a deposit for the new place covered?

[titchy]

If you've already got a bid at auction aren't you now legally committed to proceed with it?

[bakerypots]

Sorry - no it went to auction after the initial sale fell through as the buyer couldn't get the required funds together.

We will of course ask agent to try and negotiate higher but they've been pretty awful to deal with and useless in the whole process so far!

[bakerypots]

And no - we have a reserve in place so if it doesn't meet that we aren't bound.

We are moving in with family as a temp fix and will happily rent instead of staying in the house

[Ltc2020]

I think this can effect your credit score but I’m not sure? OP why do you need to leave so imminently?

[Tappering]

It would only affect her credit score if she was to make a late payment or default.

OP you can ring your mortgage firm, explain what's happening to them and arrange to pay the £3k over the phone with them. I would do this on the day that you complete the sale so that you aren't incurring interest before you need to. Then make sure that you are paying a reasonable payment towards the card each month (not the minimim payment!)

[NoSquirrels]

We will of course ask agent to try and negotiate higher but they've been pretty awful to deal with and useless in the whole process so far!

At auction you get what you get. So I do t think that’s a viable plan.

But you can speak to your mortgage lender and see whether there is any consideration they can make for you.

If you need to go down the credit card route perhaps a money transfer card would be best? Look at this article: www.moneysavingexpert.com/credit-cards/money-transfers/

[ChaChaCha2012]

Have you taken into account the legal fees of selling, both for the auction and conveyancing? Also check if there is an early repayment fee on the mortgage.

[AuntieDolly]

Can you auction a mortgaged property?

[Mehmehmeh19]

I don't think they'll let you pay over phone with a credit card, but if you get bank details and transfer it they'll not know.

Also as mentioned above what about fees? Have you factored those in.

Be worth speaking to your lender to see if they can arrange a shortfall at sale plan for you? To pay it back over x period?

[bakerypots]

So - we met our reserve so have enough to cover the mortgage costs! Woooohooo.

We have the cash to pay our agent/solicitor (our sales proceeds won't cover it)

[mountains76]

Congrats. Sounds like you where quite keen to get out of there. How long ago did you buy it to be in negative equity?

[Tappering]

@AuntieDolly

Can you auction a mortgaged property?

Yes but you have to tell your lender and get their agreement. And if there is a shortfall then you are still liable for that debt.

[RandomMess]

Really happy for you