Are there any fees associated with selling a house with a mortgage?

The amount needed to complete a sale is usually more than the mortgage balance shown on a recent statement. Your lender will provide a redemption statement setting out the balance required on a specified date, together with any interest and account charges that apply up to repayment. The figure can change if completion takes place on a different date.

Ask your lender or conveyancer to obtain an up-to-date redemption statement before accepting an offer. Check that it shows:

• the remaining mortgage capital;
• interest calculated up to the proposed repayment date;
• any early repayment charge under your mortgage conditions;
• any charge for closing or administering the mortgage account; and
• the date by which the quoted amount must be paid.

An early repayment charge is most commonly relevant when you repay a fixed-rate, discounted or other deal before its product period ends. The charge should be set out in your mortgage offer or terms, but it is still worth asking the lender to confirm the precise amount for your planned completion date. If you are close to the end of a deal, compare the cost of completing before or after that date, taking account of any additional mortgage interest and other transaction costs.

Your conveyancer will normally use the sale proceeds to repay the lender and remove its legal charge from the property title. If the sale proceeds do not cover the full redemption figure and the associated completion costs, you will need to agree how the shortfall will be funded before contracts are exchanged. This is particularly important where the property has fallen in value, the mortgage is in arrears, or other charges are secured against the title.

Property type can create additional expenses. For a leasehold property, the managing agent or freeholder may charge for information needed by the buyer’s conveyancer, notices of transfer or charge, and other administrative steps. Outstanding ground rent or service-charge balances may also need to be settled. These are not mortgage fees, but they can reduce the amount you receive from the sale and should be identified early.

Other possible costs include:

• fees for a mortgage broker if you arrange replacement borrowing;
• valuation or product fees connected with a new mortgage;
• costs of correcting title problems or obtaining an indemnity policy;
• bank or electronic-transfer charges applied during completion; and
• tax advice or capital gains tax where the property is not treated as your main residence.

There is not usually Stamp Duty Land Tax for selling a property, as that tax is generally connected with the buyer’s purchase. However, tax treatment can differ for investment properties, second homes, inherited property and properties held through certain arrangements, so obtain advice if the home has not been your only or main residence.

If you use an estate agent, check whether its commission is payable on accepting an offer, on exchange of contracts or only on completion, and whether the agency agreement includes a withdrawal fee or a continuing commission clause. A direct sale without an estate agent may remove estate-agent commission, but it does not automatically remove conveyancing, lender or property-related charges. Any proposed sale route should set out clearly which costs you remain responsible for.

Before committing to a sale, request a written breakdown from your conveyancer and lender. Compare the redemption figure with the expected sale proceeds, then deduct the agreed selling costs, outstanding secured debts and any leasehold or tax liabilities. This calculation shows whether the sale will leave money for you, require additional funds, or need further negotiation.