Negative Equity

The difference between the value of your house and your mortgage, when the value is less than the mortgage outstanding. This is caused by a general fall in the market value of a mortgaged house. This can create difficulties for individuals who can no longer maintain the repayments on their mortgage as they will be unable to cover the full amount of the mortgage if they sell the house.

This is why lenders will generally not lend anymore than 90% LTV of the property to ensure this situation does not arise. It is also why lenders charge Higher Lending Charges on high LTV properties to cover them on any potential loses if the house is repossessed.

Jargon Buster

Use the links below and the resulting list of terms on the right to locate the term you are looking for. If you can't locate it, please get in touch.

A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z
keyboard_arrow_left

keyboard_arrow_right

We have loads of great customer reviews