The house repossession process makes you homeless. In a nutshell: If you fall behind with your mortgage payments you are said to be "in arrears". Your mortgage lender will want you to catch-up and pay-off the arrears. If you donít, your lender will then seek possession of your home. Effectively your lender starts legal action through the courts with a view to evicting you.
By evicting you, your lender is then free to sell the property to recoup their funds. If there is any shortfall resulting from the sale (not uncommon), you can be pursued for up to 12 years for the outstanding debt (in England and Wales). The situation is slightly different in Scotland where the time available to the lender to pursue the debt can range from 5 to 20 years. It all depends on whether your lender decides to treat the shortfall as secured or unsecured debt.
During the credit crunch lenders seem predisposed to acting early, particularly on high loan to value cases.
The process can be halted at any time
The further into the repossession process you get, the more your range of options narrow and the more likely you are to need specialist help - which can take a number of forms. It is always better, if you can save your own house. You increase your chances of keeping your home if you avoid the common mistakes people make. A little bit of knowledge goes a long way. If you believe you've found a solution there is a way of halting or freezing your repossession.
Research shows that you're far more likely to reach an agreement with your lender (in or out of the courts) if you have legal representation. But lawyers cost money...
Charity Transact a forum promoting financial inclusion, has drawn attention to the rising numbers of homeowners threatened by repossession because of the credit crunch. It says rising demand for legal help or support from specialist advisers means some people may not get access to specialist advice. The charity says some homeowners may not qualify for legal aid or be able to afford a solicitor.
We've also noticed that homeowners can struggle to get access to solicitors (free or paid) at short notice. So act early to avoid being one of the homeowners that "slips through the net".
Reaching the end of the road..
If you feel you have exhausted all the options for stopping repossession on your own, the clock of course doesn't stop ticking. Selling your house may be your last resort.
Even if you decide to sell, there are a range of alternatives for selling depending on your circumstances, your property and where you live.
If you don't have time to sell on the open market using an estate agent (or have tried and failed..) you can opt for an outright cash house sale to a professional property buyer.
If you want to avoid repossession but remain in your home it may be possible. In Scotland, for example, homeowners in arrears have the option for applying to a Government scheme which puts qualifying homeowners in touch with a social landlord. The Government has also recently introduced schemes in other parts of the UK, but their effectiveness is yet to be proven. But it is always worth finding out if you qualify.
If you think you may need the assistance of a professional property buyer to help you avoid losing your home you're welcome to contact us on 0800 043 0669. Alternatively complete the form below.