Selling your home because of debt or money worries

When money is tight, selling your home can feel like the only way out. Sometimes it is the right answer, but often it isn’t the first one. Before you decide to sell, speak to a free debt adviser: many debts can be managed without selling, and a quick sale usually means accepting less than your home is worth.

This guide explains where to get help, how Breathing Space works, why it matters whether a debt is secured, and how to avoid rushing into a decision you can’t undo.

Where can you get free debt advice?

These services are free and independent:

Citizens Advice: local offices and online guides across the UK.
StepChange: a debt charity giving free, impartial advice.
National Debtline: free debt advice by phone, webchat and online tools, with separate advice for England and Wales and for Scotland.
MoneyHelper: free, government-backed money guidance.
Shelter (England), Shelter Cymru and Shelter Scotland: housing advice, including mortgage arrears.
Housing Rights (Northern Ireland): help if you’re behind on your mortgage.

A good adviser will look at your income, your spending and all of your debts together, then explain the options. That picture is what tells you whether selling your home would actually solve the problem.

Formal debt solutions. Among the options an adviser may discuss are an Individual Voluntary Arrangement (IVA) in England, Wales and Northern Ireland, or a trust deed in Scotland. Our sister sites explain how they work: IVA Helpline and TrustDeeds.co.uk. Both are run by Simply Quote Comparison Ltd, the company behind this site. Unlike the free services above, they are enquiry services, not independent advice. Ask an adviser what any solution would mean for your home before you decide.

What is Breathing Space?

Breathing Space, officially the Debt Respite Scheme, applies in England and Wales. It gives you legal protection from your creditors while you get advice.

A standard breathing space lasts up to 60 days. During it, creditors must pause most enforcement action and contact, and most interest and charges on the debts it covers are frozen.
A mental health crisis breathing space lasts as long as your mental health crisis treatment, plus 30 days.
You can’t apply yourself. It has to be started by a debt adviser authorised by the Financial Conduct Authority or by a local authority that provides debt advice.
To qualify for a standard breathing space, you must live or usually reside in England or Wales, not be in a debt relief order, an IVA or bankruptcy, and not have had a standard breathing space in the last 12 months.

For your home, the key point is that a breathing space can include mortgage arrears that existed when it started, but your ongoing mortgage payments must continue.

Scotland has a different scheme. mygov.scot explains that a moratorium gives 6 months’ protection from creditors for people with unsecured debts, stopping them from arresting your bank account, freezing your wages or applying to make you bankrupt. It doesn’t write off debt or stop interest being added.

Which debts can put your home at risk?

This is the question that matters most when you’re thinking about selling.

Citizens Advice separates priority debts, which can cause particularly serious problems if you don’t deal with them, from non-priority debts. Priority debts include:

mortgage arrears or secured loan arrears
rent arrears
council tax arrears
gas or electricity bills
court fines and unpaid tax

Non-priority debts include credit cards, catalogue debts and unsecured loans. For these, creditors generally have to take court action to recover the money.

Secured debts are tied to your home. If you don’t pay a mortgage or secured loan, the lender can ultimately ask a court for possession. When you sell, anything secured on the property is repaid from the proceeds before you receive the balance.

Unsecured debts don’t usually give a creditor a claim on your home straight away. In England, though, Citizens Advice explains that a creditor with a county court judgment can apply for a charging order, which secures the debt against your home. If you then sell, you must pay that creditor from the proceeds, and the creditor can apply for an order forcing a sale.

If most of what you owe is unsecured, a debt adviser may be able to suggest options that keep you in your home. Selling to clear unsecured debt is something to think through very carefully first.

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Want to know what a cash buyer would offer?

Tell us about the property in 2 minutes. Vetted buyers, individuals and institutions, reply with offers.

Cash buyers usually offer less than full market value in return for speed and certainty. You are free to turn down any offer.

What if you’ve lost your job or your income has dropped?

A sudden change in income is one of the most common reasons people start thinking about selling.

Check your benefits. A drop in income may mean you’re now entitled to support you weren’t getting before. GOV.UK links to independent, free and anonymous benefits calculators you can use to check.
Talk to your mortgage lender. Citizens Advice explains that lenders have to treat you fairly and consider requests to change the way you pay. You can ask about extending the term, switching to interest-only for a while, or a payment holiday.
Support for Mortgage Interest. If you get a qualifying benefit, you may be able to get help with your mortgage interest. GOV.UK explains that it’s a loan, repaid with interest when you sell or transfer your home.

If your situation is temporary, these steps can buy time without giving up your home.

Why is it worth not rushing?

Selling under pressure is when people are most likely to accept a poor deal. A few things to weigh up:

Price. A quick sale to a cash buyer usually means accepting less than full market value in return for speed and certainty. Shelter warns that some companies make money by buying homes for less than they’re worth. Get a proper idea of your home’s value first, and read our guide to how much cash buyers pay.
Where you’ll live. Selling ends your mortgage payments but not your housing costs. Work out what renting nearby would cost.
What’s left. Add up what will be repaid from the sale (mortgage, secured loans, charging orders, costs) to see what you’d actually walk away with.

Be very cautious if anyone offers to buy your home and let you stay as a tenant. That’s sale and rent back, which only FCA-authorised firms can offer, and the FCA requires them to warn that you’re unlikely to get the market value of your home. We don’t offer it. Our guide to sale and rent back explains the risks, and MoneyHelper has guidance too.

If selling is the right decision

Once you’ve had free advice, you may decide that selling is the best way forward, perhaps to clear secured debts, to move somewhere cheaper, or simply to take the pressure off. If you’re behind on your mortgage, read our guide to facing repossession as well.

If a quick sale feels right after that, you can tell us about your property and, with your consent, we’ll pass it to vetted cash buyers on our panel. We don’t buy or value homes ourselves, our service is free, and you’re under no obligation to accept any offer. An estate agent may get a higher price if you have more time, so it’s worth comparing both.

Common questions

Should I sell my house to pay off my debts?

We can't tell you whether to sell, and it depends heavily on which debts you have. Mortgage and secured loan arrears can put your home at risk, while credit cards and unsecured loans are usually dealt with differently. A free debt adviser can look at your whole situation and explain the options before you decide.

Does Breathing Space stop my mortgage payments?

No. In England and Wales, Breathing Space can include mortgage arrears that existed when it started, but your ongoing mortgage payments must continue. It pauses most enforcement action and creditor contact and freezes most interest and charges on the debts it covers.

Can creditors force me to sell my home?

In England, a creditor who has a court judgment can apply for a charging order, which secures the debt against your home. They can then apply for a separate order for sale. Citizens Advice describes a charging order as very serious, so get free advice as soon as a creditor mentions court action.

How quickly can I sell if I need money urgently?

It depends on the buyer and the legal work. A chain-free cash buyer can often move faster than an open-market buyer, but searches, the buyer's checks, your solicitor and any mortgage to repay all take time. Speak to a debt adviser in the meantime, as they may be able to pause pressure from creditors.