The lender is selling my home - Mortgage stress

Mortgage stress logoWhen the lender has possession of your property, it will take steps to sell your home.

The sale will usually be by public auction or private treaty. The lender is required to get a reasonable or fair market price for your property. If the final offer is well below a reasonable value, the property will not be sold (it will be passed in).

The lender does not have to get a price that covers what you owe. It is possible that the property will be sold for a fair market price that is less than the total debt you owe. The lender may get the remaining money you owe (called a shortfall) in other ways.

The costs of the sale are added on to the judgment debt, so it is better to try and settle the matter before the house is sold.

They are going to sell my house. I don’t want to fight it. I just want it to be over.

House for saleContact the lender to see if you can make an arrangement about the money owed under the judgment, details of the lender taking possession of the property or both. If you need more time to move out, ask the lender for more time.  

What if the lender wants to fix things at the property before the sale?

The lender should not sacrifice your interest when selling the property. The lender can spend reasonable amounts to make the property saleable or to improve the return on the property (for example, by landscaping or tidying it up, or maintaining it for sale). But the lender does not have to do this.

What if my house sells for less than I owe the lender?

If the amount the lender gets for the sale of your home is less than what you owe under the judgment, you will owe the shortfall to the lender. The lender can take other enforcement action against you to get what the shortfall. One enforcement option is bankruptcy.

Who is liable for rates, taxes and utilities on the property?

You will be liable for all rates, taxes and utilities until the property is sold. You should talk to the lender about whether to end your contracts with utilities (for example, gas, water, electricity) to avoid more costs if you are no longer living at the property.


The information displayed on this page is provided for information purposes only and does not constitute legal advice. If you have a legal problem, you should see a lawyer. Legal Aid Western Australia aims to provide information that is accurate, however does not accept responsibility for any errors or omissions in the information provided on this page or incorporated into it by reference.