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A repossessed house and what happens.

When a house is repossessed and the bank is owed a certain amount for it on the mortgage and any outstanding secured loans, does it sell for that price or is it put up at its market value? even if the market value is much higher than what is owed to the bank and creditors.

Asked on Aug 20 2010, General in Liverpool | Report content

Answers (1)

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  • When a lender has repossessed a house and then sells it to recover the funds to repay the loan the lender has to get the best possible price for it. To do that they need to actually expose the property to the open market and advertise the fact that they have had an offer for a certain time, (just in case someone else can come along with a higher offer). Only then can they proceed to actually sell the property. They lender will take the funds that are due to them under the mortgage together with the costs for dealing with the sale. The surplus funds will then go to pay any second or other secured loan. If no other lender the surplus funds go to the borrower who has been repossessed.

    Web reference: http://www.pinkswan.co.uk

    Answered on Aug 20 2010, Report content

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