Sell house despite credit

If selling the house is unavoidable, you can sell despite having a current loan. It is important that you choose an option that causes you as little additional costs as possible. If the sale takes place in the first 10 years of the financing, the bank can demand an early repayment penalty if the financing is terminated early. Here we show you how to sell in the best possible way and without avoidable financial losses and how to sell your property during the repayment phase.

Selling a house despite a loan: Paying a prepayment penalty or transferring the loan to refinancing?

You are bound to a real estate financing for 10 years despite a longer repayment phase. This period only does not apply to you if the fixed borrowing rate is shorter. If it becomes necessary to sell the house before the end of the period, you can cancel your loan, but you will have to pay an early repayment penalty to the bank. The lender misses out on interest, which he recovers from you and which can amount to several thousand euros for a real estate loan.

Avoid additional costs: Here’s how!

To avoid these additional costs, you should take a closer look at the following two options:

The family has grown and your original house has become too small? Then you have the option of transferring the loan into a new financing. In this case, you can save the prepayment penalty and refinance by removing the previous property from the land register and registering your new purchase as collateral for the loan with the bank. A transfer of the loan to a new real estate loan is tied to the condition that the new house is either more expensive, but at least equal to the sold property.

In general, it’s a good idea to look at different ways to avoid a prepayment penalty and avoid making the high interest payment to the lender if you can.

Transfer existing loan to home buyer

When selling a house, under certain conditions there is the chance to sell the current real estate loan. If the buyer agrees to take over the loan at identical conditions and has sufficient creditworthiness for the bank to approve the transaction, you will be free of liabilities when the house and the loan are transferred. In this case, you do not have to pay a prepayment penalty, as the buyer takes over your financing and pays it to the bank at the existing agreements according to the loan contract. If you are planning to sell the property including the loan, we recommend that you take great care in your search for a solvent buyer.