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Can i sell my house for 30% less than its worth?
wharty
Posts: 426 Forumite
Hi, weird question i know but here it goes.
We have had our 2 bed apartment on the market for 8 months now, and no offers untill monday this week. The people we want to buy our new home from are moving abroad but their daughter is staying in the uk. They have offered to drop the asking price on their home by 20% and sell to us if we drop our price by 30% so their daughter can buy our apartment. We think this may be a good idea but still not sure if this is legal and weather our current mortgage lender would allow us to sell our home for less than we owe on our mortgage.(the difference would be £37,500 to us) But the house we want to buy is worth £199,950 so a saving of about £40,000 on the current market value. Please someone help because we really want to move as my wife is 2 months pregnant so we need the space more than ever.
Thanks Lee and Emma.
We have had our 2 bed apartment on the market for 8 months now, and no offers untill monday this week. The people we want to buy our new home from are moving abroad but their daughter is staying in the uk. They have offered to drop the asking price on their home by 20% and sell to us if we drop our price by 30% so their daughter can buy our apartment. We think this may be a good idea but still not sure if this is legal and weather our current mortgage lender would allow us to sell our home for less than we owe on our mortgage.(the difference would be £37,500 to us) But the house we want to buy is worth £199,950 so a saving of about £40,000 on the current market value. Please someone help because we really want to move as my wife is 2 months pregnant so we need the space more than ever.
Thanks Lee and Emma.
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Comments
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To enable you to sell your property you will have to repay in full the amount outstanding on your mortgage. If you don't the lender will not rescind its charge on the property and the new owner will not get good title.0
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jonesMUFCforever wrote: »To enable you to sell your property you will have to repay in full the amount outstanding on your mortgage. If you don't the lender will not rescind its charge on the property and the new owner will not get good title.
Oh right thats a bummer so they wouldnt let us carry the debt on the mortgage over to the new house? And even if our loan to value ratio was slighly higher when the deal was done?
Thanks for your help0 -
Oh right thats a bummer so they wouldnt let us carry the debt on the mortgage over to the new house? And even if our loan to value ratio was slighly higher when the deal was done?
Thanks for your help
Effectively, you are in negative equity. Some lenders did allow borrowers in negative equity to move and transfer their mrotgage to the new house. You should speak to them.No reliance should be placed on the above! Absolutely none, do you hear?0 -
Hypothetically a bridging loan might do it.
A lot will come down to the value the valuers place on the property though.
You may find that 30% below market price is actually the value the valuer puts on it.Bankruptcy isn't the worst that can happen to you. The worst that can happen is your forced to live the rest of your life in abject poverty trying to repay the debts.0 -
Wharty
Another point you may need to check with your solicitor is whether any of these actions would be seen, by the Inland Revenue, as any party trying to evade paying Stamp Duty.A retired senior partner, in own agency, with 40 years experience in property sales & new build. In latter part of career specialising in commercial - mostly business sales.0 -
Yes, Stamp Duty (SDLT) is assessed on market value in these exchange of property cases. Obviously in the present market it is an interesting question what any property is actually worth so some reduction may be acceptable - but you can't simply invent figures - they have to be supportable in the real world market.RICHARD WEBSTER
As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.0 -
Thanks everybody i appreciate your comments.0
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