Things can seem overwhelming when you’re still paying your mortgage while also getting ready to sell your home.
One thing to remember is that you will still have to pay your mortgage for the month the sale is due to complete.
At Property Saviour, we’re experts in quick house sales. We’ll help you answer this important question. We’ll explain how things will likely go in various situations so you can decide what to do next.
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When Do You Stop Paying the Mortgage on a Property For Sale?
You must pay the mortgage until the date the sale has completed. After that point, the new owner will take over responsibility for the payments.
Do you have to pay the mortgage in the month you sell? It depends on the completion date. If the mortgage is due before the completion date, you will need to pay it. If it is due after, the new owner will need to handle it (unless they are buying with cash).
It is also important to remember that you will be liable for estate agency, solicitor, and early redemption costs if you end your mortgage before the end of the term.
Can you stop paying a mortgage?
No. If you stop paying your mortgage, then your account will go into arrears. The bank will start repossession proceedings, and your credit score will be affected.
If you use the proceeds from the sale of your property to pay off the remainder of your mortgage? If so, there would be nothing left to pay.
However, if that is not the case, you may be able to ‘port’ your mortgage. In simpler terms, this means ending the mortgage on the property you’re selling, and your lender may then open a new one against any property that you are buying.
If you are in negative equity, then you should contact your mortgage lender. They will be able to tell you their approach to such situations.
What happens if I buy a house before selling my house?
Chains can always make property transactions complicated. Therefore, moving into a new house before the sale of your old one is an attractive option.
There are certain risks associated with this approach. For instance, if you use an estate agent to sell, there is a chance that the buyer may pull out of the deal right up until the exchange of contracts.
Another potential difficulty is that your old house may take a long time to be sold. This means that you will have to pay the costs of two homes in the meantime.
If you have not budgeted properly, it is best to try to reduce the gap between the purchase of your new house and the sale of your old one. This is not always possible, so it is important to be aware of the risks if you can’t control the sale in this way.
What happens to your existing mortgage when you sell your house?
When it comes to selling your home, your solicitor will use the sale proceeds to pay off your current mortgage. It’s essential that the sale price is greater than your mortgage balance – if it isn’t, you’ll find yourself with negative equity.
You may also have the option to port your mortgage to a new property. This would allow you to take your existing mortgage with you to finance your new home, potentially helping to cut down on moving costs and avoiding early repayment fees.
However, this option is dependent on your lender’s policies.
Do you need to tell your mortgage company if you are selling your house?
You don't have to tell your mortgage lender that you're selling your home until you've accepted an offer. But it might be beneficial to give them a heads-up. They can give you details of any early redemption charges.
What happens if I sell my house but don’t move into a new one?
If you are looking to sell your house and not purchase another, the equity you have accumulated over the years will be transferred to you, minus any associated costs. These can include estate agent fees, legal charges, closing expenses, and taxes.
Equity is the difference between the final sale price of the property and the remaining mortgage debt owed. This difference can be created from your mortgage deposit at the initial purchase, regular mortgage payments, or any increase in the property’s value over time.
Understanding how your equity is determined can help you understand your financial situation after the sale. Once all the fees and costs have been settled, you will have a sum that is yours to spend however you wish.
You can invest it in another property, save for retirement, or simply treat yourself to a well-deserved holiday. The choice is yours!
Will the solicitor pay off my old mortgage?
Indeed, your solicitor will handle the closing of your previous mortgage using the proceeds from the sale of the property.
They can also subtract any fees that are due at the end of the transaction. The remaining amount is then transferred to your bank account unless you are investing the funds in a new property.
Talk to Property Saviour
Most sellers want to get rid of their property quickly to avoid having to make payments on two homes. If this is the case for you, Property Saviour can help.
Get in touch with our team today, and we will provide you with a no-obligation cash offer worth up to 70% of the fair market value of your home. We can complete the sale in as little as 10 days – no solicitors’ fees or estate agency charges to worry about.
This means you can move into your new home without having to worry about the mortgage.
For more information about our fast homebuying service, contact us today. Our team will be more than happy to assist.
Property Saviour Price Promise
- The price we’ll offer is the price that you will receive with no hidden deductions.
- Be careful with ‘cash buyers’ who require a valuation needed for a mortgage or bridging loan.
- These valuations or surveys result in delays and price reductions later on.
- We are cash buyers. There are no surveys.
- We always provide proof of funds with every formal offer issued.
We'll Pay £1,500 Towards Your Legal Fees
- No long exclusivity agreement to sign because we are the buyers.
- You are welcome to use your own solicitor.
- If you don’t have one, we can ask our solicitors for recommendations.
- We share our solicitor’s details and issue a Memorandum of Sale.
Sell With Certainty & Speed
- Our approach is transparent and ethical, which is why sellers trust us.
- 100% Discretion guaranteed.
- If you have another buyer, you can put us in a contracts race to see who completes first.
- Complete in 10 days or at a timescale that works for you. You are in control.
