Can You Sell Your House if You Have a Secured Loan Against It?

Written by Daniel Tannenbaum on September 2, 2021

Updated April 28, 2023

Yes, you can sell your house if you have a secured loan against it, however, you’ll usually need to pay the loan back in full before moving.

A secured loan can be a great borrowing option for those who are prepared to use their valuable asset (e.g. a property) as security on the loan. They often come with lower repayments and interest rates in comparison to unsecured loans, as lenders deem them less of a risk due to the added security.

While a secured loan can be a good borrowing option to consider, it’s important to note that the loan will be secured onto the valuable asset you choose (typically your house), which means that if you fail to keep up with repayments, your house could be at risk of being repossessed.


Do I Have to Pay Off My Secured Loan Before Moving House?

Usually, you will have to pay off your secured loan before moving to a new property, however this isn’t always the case. Some lenders might be open to the secured loan you have being transferred; however, this will be subject to the details of the situation, including your affordability as a borrower and the equity held in the property you’re wishing to move to.

If you want to move but can’t pay back your secured loan before this, transferring the loan may be the best way to go. When in this situation, it’s best to speak with your lender about the options available to you, so that you can make a more informed decision.

Below are a few of the options that could be available to you when wanting to move house but holding a secured loan on your current property:

  • Transfer the secured loan to the new property
  • Pay off the remainder of your secured loan before putting the property up for sale
  • Pay off your secured loan with the money from the sale of your current home
  • Borrow an unsecure loan to pay for the remainder of your secured loan

There are a variety of ways you can pay off your secured loan. The right option for you will depend upon your personal circumstances, and how you feel you could best manage the payment.




Does Having a Secured Loan Affect Your Mortgage Approval?

According to the property experts at Ready Steady Sell, if the homeowner loan is paid off in full once you sell the secured property, it should not affect your mortgage application.

When you sell a property, the money from this sale must be used to pay off any mortgage you have before other outstanding debts are paid. You might have the option to include your existing secured loan into a remortgage, however the eligibility for this will depend upon the details of your situation. If in doubt, it’s best to speak with a financial advisor or a broker, who will be able to help you in finding the best borrowing option.


Can I Transfer My Secured Loan Over When I Move House?

You may be able to transfer your secured loan over to the new property you’re wanting to move into. Transferring your secured loan in this way can come with pros and cons – while it can help borrowers avoid any early repayment fees they may otherwise have had to have paid before moving into the new property, transferring the loan can take a significant amount of work, borrowers having to organise and provide all the details necessary to amend the deal.


Can a Secured Loan Be Written Off?

It’s unlikely that a lender would write off your secured loan with them, as they come with a valuable asset used as security and are often for large amounts of money.

If you are struggling to keep up with repayments on your secured loan, it’s important to discuss the issues you’re having with your lender, as they may be able to work with you to come up with an alternative solution and make your repayments more manageable.

When struggling with your secured loan repayments, don’t simply stop paying your loan, as the property/valuable asset you’ve secured onto the loan could be at risk of repossession.

To discuss your secured loan requirements, get a free quote from Lending Expert today >>


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