Surrendering your property

If you know you cannot afford to keep your property, you can sell it and find more affordable housing.

Lender help

You should contact your lender and tell them that you are doing this as they may be able to help you sell your house. Some lenders offer an assisted voluntary sale scheme. This means they will give you time to sell the property and help you with any costs involved.

Costs involved

There will always be costs involved if you want to sell your house. You will need to pay for a valuation and estate agent's fees. Depending on the value of your property you may need to pay for a Home Information Pack (HIP).

Surrendering your property

You can also consider handing the keys to your property back to the lender. If you do, you are giving them permission to repossess. This is also known as voluntary surrender. You will still be responsible for any mortgage payments or mortgage shortfall.

Help and advice

If you want any advice on this, please call our Helpline and speak to one of our advisors. They can give you specialised mortgage advice and help you to solve your housing payment problems.

FAQs

What is equity?

England and Wales > Housing > Mortgages > Surrendering your property

Equity is the difference between the value of your house and the value of your mortgage and any secured loan. To work out the amount of equity in your property you will need to know how much your house is worth and how much you have to pay back on any debts secured against it. For example, if your house is worth £100,000 and you have a mortgage of £50,000 and a secured loan of £10,000 you will have £40,000 in equity.

What is a mortgage shortfall?

England and Wales > Housing > Mortgages > Surrendering your property

A mortgage shortfall occurs when a house is sold and there is not enough money from the sale to pay back the mortgage and any secured loans. For example, if you have a mortgage of £100,000 and sell your house for £95,000 you will have a mortgage shortfall of £5,000. This will become an unsecured loan. Your lender will expect you to come to an arrangement to pay this back.

What is negative equity?

England and Wales > Housing > Mortgages > Surrendering your property

If your house goes down in value so it is worth less than your outstanding mortgage you will be in negative equity. If you sold the house you would not be able to pay the whole mortgage back and would have a mortgage shortfall

Can I apply for a council house?

England and Wales > Housing > Mortgages > Surrendering your property

Most people can apply for a council house but there will be a waiting list. Council houses are allocated on a points system. How long you wait to be given a house will depend on how many points you have. The council will give a higher priority to vulnerable people, people with children and people who are homeless.

If the council thinks you have made yourself intentionally homeless you may not be able to apply for a council house.