Can You Sell a House With a Mortgage?

Are you thinking of selling your house while you still have a mortgage? If so, you’ll need to find out if you can. When it comes to selling a property, it’s important to conduct thorough research – not just about the selling process, but also the effects of having a mortgage. If you’re considering moving homes with a mortgage, continue reading to learn everything you need to know.

What is a Mortgage?

A mortgage is a loan that allows you to purchase a property. It’s a secure loan that can be repaid over a long-term period, usually in monthly instalments. Interest is added to the loan, and if for any reason you miss repayments, you could face several negative consequences. If this happens, your mortgage lender can take you to court, where fees or penalties may be issued.

According to recent mortgage statistics from 2024:

• There were a total of over 12.5 million outstanding mortgages in June
• On average, outstanding mortgage debt in the UK per home is about £132,378

So, is it Possible to Sell a House With a Mortgage?

Yes, you can sell a house with a mortgage. However, it’s not as simple as it sounds. We advise that you only sell a house with a mortgage if you can afford to pay off the remaining amount with no issues.

Selling a house without a mortgage has become fairly common, but in some cases, the process can be complicated. Typically, you’ll be faced with two options when you decide to sell your house without a mortgage:

1. Pay off your mortgage by selling your property and using funds from the sale
2. Port your mortgage to a different property

If you’re certain that you want to sell your home with a mortgage, you’ll need to consider both options available and decide which is the best route to go down. It’s important to note that some mortgage lenders may have certain terms in place regarding porting a mortgage – this is something you should check before making a decision.

Porting a Mortgage

What does porting a mortgage mean? When you port a mortgage, you’re essentially moving your mortgage deal from one home to another. The process allows you to buy a new home but keep your current mortgage rate. 

As discussed, you will need to check whether your lender allows mortgages to be ported to a different property. If you’re unable to port your existing mortgage, you will likely need to take out a new mortgage with your current lender or find a different one.

How Long After Getting a Mortgage Can You Sell Your House?

In the UK, there is no current law on how long you have to wait to sell your house – however, some lenders will refuse to offer a mortgage if a new buyer has lived in their previous property for fewer than 6 months.

For this reason, you should carefully decide whether or not you should sell your house if you’ve only been there for a short period. We understand that it’s easy to think you’ve found your forever home, but then not long realise it’s not right for you and your family.

5 Things to Consider Before Selling a House With a Mortgage

If you want to sell your home with a mortgage, some key factors should be considered beforehand. Moving properties can be exciting – a new chapter in your life. However, there’s so much to think about, and we know it can often feel overwhelming.

Before selling a house with a mortgage, you should think about your decision thoroughly and whether it’s the right path to go down. Some things to consider:

1. The sale price of your current home must cover the remaining amount of your existing mortgage, plus any additional fee
2. If you have negative equity, it’s advisable not to sell your home
3. If you’ve recently had issues with employment, the lump sum amount from your property sale could potentially affect your chance to claim any benefits
4. Until the sale is complete, you’ll be responsible for any payments on your home
5. There may be a period of time when you’ll need temporary accommodation while you find your next home

What is Negative Equity?

Negative equity is when the overall value of your current property is lower than the outstanding amount on your mortgage balance. Knowing if you have negative equity can be done by calculating the market value of your home and subtracting the amount left on your mortgage.

For example, if your home was £200,000, but you paid a £20,000 deposit, your mortgage amount would be £180,000. If you then paid a further £10,000 off your mortgage, you now owe £170,000. However, let’s say the housing market declined slightly, and now the value of your home has dropped to £100,000 – this would result in negative equity, and you would owe £70,000.

Working With a Reputable Estate Agent

Working alongside a trusted estate agent is essential while selling your home. If you’re located in or around the Wirral, Merseyside, we encourage you to consider Liam Gretton and his team. At Liam Gretton, you can expect top-quality service, ongoing support, guidance, and expert advice.

We understand that moving homes can be stressful – but it doesn’t need to be. We can help you sell your home on the Wirral and portray the property and its unique features in the best light. Additionally, we work closely with trusted partners who can offer expert mortgage advice.

To learn more about how we could help you, please get in touch with us today. We look forward to speaking with you soon!