According to the BBC only 4580 homes were repossessed by mortgage lenders in 2019. This represents the lowest number of repossessions since 1980.
However, the most recent government statistics show that mortgage repossession claims (the first stage towards repossession of a property) have started to rise from a low base in 2015. This may well translate to more repossessions in 2020, so what can you do to stop the bailiffs knocking on your door?
Much will depend how bad your situation has become, but even if you have been handed a court order, and proceedings for repossession of your home have been started, there are still ways that you can deal with the situation.
Falling Behind on Payments
Lenders will normally only start to take action if you miss payments for two months if you are having difficulties, the best thing to do is let your lender know and see if you can come to an arrangement with them.
If you fail to come to an arrangement with your mortgage lender, they are likely to send you a letter from their solicitor demanding payment, before issuing repossession proceeding with the county court.
Attend Repossession Proceedings
By attending the proceedings, you may be able to come to some arrangement with the court and your lender. However, if you do not attend, the court will have no alternative but to order repossession.
If you can make an offer to keep paying your monthly installments, plus something towards the arrears, the judge may be satisfied with this, and grant a Suspended Order For Possession.
Bailiffs
If you have made no acceptable offer for repayment, or defaulted on a Suspended Possession Order, then your lender has the right to seek repossession of your property.
In this situation, a court order will be granted, and a date will be set for a court bailiff to visit your property to formally take possession. You will normally be given just 10 minutes to pack your things and get out.
At any point in the process, before the bailiffs arrive, you still have a number of options to solve the problem. These are;
Negotiate repayment
If you can afford to pay make your normal monthly mortgage instalments and pay something towards the arrears, the lender may be able to agree to this.
Pay off all of the arrears
Your options here are to borrow money from friends and family, another lender or a specialist company such as Molae Properties. It is important to be careful here though, as if you can’t afford the payments on a new loan, you may have more lenders chasing you for money.
Remortgage
Stop your repossession fast by remortgaging with another lender. This is possible if your house is worth more than the combined value of your mortgage, the mortgage arrears and any professional fees the mortgage company may have added to your debt.
Sell your property with an estate agent
You could do this through an estate agent, which would probably get you the best price for your house, though there are downsides – it could take many months to find a buyer and complete a sale. This might not satisfy your lender. You may even need to spend money on your house to attract buyers.
Stop Repossession Fast
A property buyer like Molae Properties, who buys property in the London area, will typically offer you 80% of the market value of your property. In return they will give you a fast sale, completing the exchange of contracts at the necessary timescale to stop the repossession. If you are facing a repossession order and you have some equity in your property this could be the answer, avoiding the hassle and stress of finding a buyer yourself.
Even if there is not much equity in your property Molae Properties can provide a money advance to settle the arrears and regain control of the sale of your property.
Voluntary Repossession
It is hard to think of a set of circumstances where voluntary repossession is a good idea. In general, you should avoid this at all costs. The mortgage arrears continue to increase even after the repossession takes place right up until the day the property is sold by the lender. This can take months and you have no control. Some lenders employ asset managers and intermediaries to sell the property and their professional fees are added to your debt. The estate agents fees are also added to your total debt. If you have any equity left you will only get this many months later after the property is sold and once all the debts are settled.
