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Can a bank force a sale if the property has negative equity |
My bank has obtained a charge against my property and the solicitors acting on behalf of the bank are saying that they expect to be instructed to force a sale to obtain monery owed. my propety has negative equity of about £40,000.00 and the debt owed is £36,000.00 would my bank do this ?
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Re: Can a bank force a sale if the property has negative equity
Are you sure you are speaking to solicitors and not debt collectors?
If your property is in such serious negative equity there would be no point in forcing its sale - I assume the bank loan is the last charge on the property. (Your mortgage would be the first charge, a secured loan the second, and so on...)
I suspect this is a scare tactic to get extra payments out of you. You probably should make token payments towards the debt just to show goodwill.
No creditor can force the sale of a property this must be granted by a judge in the county court.
If the sale was forced on you, any shortfall (£36,000 plus costs?) would then be unsecured.
Re: Can a bank force a sale if the property has negative equity
You need to negotiate with them to find a way of repaying them as much as you can afford each month. This must be in writing so start writing to them if you're not already. Outline your debt position, income, expenditure and make them an offer of a monthly repayment. Also ask them to stop interest and charges. If it goes to court, the fact that you are trying to repay your debt will work in your favor.
If your case goes to court, and your property is sold, you may find you're liable for the debt. This debt is unsecured which then gives you access to debt solutions like an IVA or bankruptcy and they won't want this to happen.
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