Negative equity is when you owe more for your home than it's worth. This means you can't sell your house as you wouldn't have enough money to pay off the debts secured against it, and can literally mean you're stuck where you are. It's a real problem, and many people find themselves in this situation after a house price crash.
Here's an example: Say you buy a property for £200,000 and use a 95% mortgage. This would mean you've got £190,000 of mortgage debt against the property. Now imagine that house prices fall by 10%. Your home would be worth £180,000, but you'd owe £190,000 for it... Unless you have £10,000 in savings, you wouldn't be able to sell your home.
There are still options though. Have a browse of our content to see what you may be able to do.
FEATURED ARTICLE
Negative equity is distressing. But there are positive steps you can take if you want to get out of negative equity or even sell your house.
We purchase homes directly from sellers, offering homeowners a quick, straight-forward sale.
Contact us for a free valuation and offer.
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By buying your home from you at a discount to its full value, we're able to give you:
But this means you will receive less than if you were to sell your home in a traditional sale.
