Can I give my house to the bank

[bigwad]

My wife and I are currently seperating, but have a house together, we haven't had it long and there is no equity in it. We have a 100% mortgage, and rather than trying to do lots of work on the house to get it ready to sell we wondered if it was possible to almost opt for repossession but without the financial penalties, can it be done.

[chitchat]

I very much doubt that your bank will want to take the house at this stage. You need to try and sell it yourself. The banks want to lend you money not sell houses. Repossession is the last stage for lenders to recover any debt owed to them and all lenders will avoid this at all costs. There is a lot of time, effort and money involved on their part.

Have you had an estate agent come round and value the property? You may be able to sell it without losing too much. Speak to them first.

[buildersmate]

Absolutely right. They will charge you the fee costs of the 'professionals' they use to effect the house sale and charge that against the money raised by the housesale. That may well result in you ending up not clearing the sum of the outstanding mortgage so you would have negative equity (and owe them money).

[kwicky]

What you are suggesting is just handing the keys back. Whatever you do avoid this. When you hand the keys back the bank could not care a hoot what the property sells for as they are covered by the insurance YOU took out to protect the loan. Then you will be chased for the shortfall by the insurance company who tend to use agencies as the owner usually does a bunk and needs tracing.
Sell your house yourself and get the full market value as you may find the bank unwilling to let you sell if there is negative equity on it.