Selling house & negative equity

[choicer]

We have a property that is in negative equity. Only 7 years in to mortgage so about 22years left. Due to personal circumstances we cannot afford the full mortgage but looks like the bank are insisting on this so selling is pretty much the only option we can see.

If we sell, what can the bank legally do about the negative equity portion? Can they prevent the sale without a deal in place?

 

[44brendan]

You will need to address your proposal with the Bank as they will prevent any sale unless the negative equity issue is dealt with. They effectively "own" the property as a mortgage deed gives them ownerships rights until the loan is discharged.

 

[Bronte]

Can the term be extended. Are you entitled to state support with the mortgage. Would it be possible to rent out a room and get tax free income to help with the mortgage.

 

[choicer]

You will need to address your proposal with the Bank as they will prevent any sale unless the negative equity issue is dealt with. They effectively "own" the property as a mortgage deed gives them ownerships rights until the loan is discharged.

Thanks Brendan.

So essentially we'd have to make an agreement with them & even if it wasn't sustainable they could veto the sale?

 

[choicer]

Thanks Bronte.
We've explored all options & even extending the mortgage still makes it unsustainable. We don't have the space to rent out the room, unfortunately. I think we're at 'peace' with selling but just want to know the full details before starting the process. No surprises

 

[Bronte]

I'm glad you've explored all options, certainly you ought to try and get professional advice. Don't think the bank will veto the sale if you cannot afford it, but you must try and get a solution for the NE, be that it is written off or that you pay it back in a reasonable fashion. What discussions have you had with the bank. Please name the bank.