It’s a problem that many of us find ourselves in, or could find ourselves in at some point in the future, so it’s best to gain as much knowledge and help so you can deal with it effectively. As a homeowner I’m sure you know, negative equity is when the value of your property is less than the price of your mortgage, and with the fragile state of the housing market, more people may find themselves in this situation.

It is possible to remortgage when in negative equity, but in reality it’s hard. Most mortgage lenders will not be willing to offer you a loan when you are in negative equity, however, some lenders do offer special mortgages to people in negative equity, so be sure to check that out.

The options available to you are:

Overpay your mortgage – This is essentially coughing up the extra money you owe to pay off your mortgage. This is really only a viable option if you can afford it and the terms of your mortgage allow you to.

Play the waiting game – House prices will continually rise then fall, so it is up to you to make an assumption on the housing market, and whether waiting will help resolve the issue, or push you further into negative equity. At this moment in time, it would probably be best to overpay your mortgage, as the forecast for the housing market is looking bleak.

Save for a deposit – If you are able to save for a new deposit, then you will benefit from a better mortgage deal. Also, by the time you have saved up for the deposit, your house price may have recovered, bringing you out of negative equity.

To help ease these problems and your fears, we at The London Property Buyers help many people whose properties are currently in negative equity by agreeing a price with them that is actually more than today’s market value.