If you are being repossessed or are facing repossession, you need to understand the Repossession Process so you know how to stop house repossession.
When you take out a mortgage with any lender, whether it's a building society or bank, they will protect their interests by registering what is known as a “legal charge” against the property at Land Registry. They do this to ensure that the lender’s loan is satisfied first when you sell your property and they are the first creditor to be paid if you have other loans.
The “legal charge” or “Mortgage Deed” is a document which states that if you do not keep up with your payments on the loan, the lender can “repossess” your property and sell it to pay back the loan. Typically a lender will instruct legal proceedings, if you miss more than two payments, to recover the monies owed.
There are several stages to stop repossession that you will have to go through before you are provided with an eviction date. If payments are not satisfied the lender will instruct solicitors to apply to the courts for a repossession order to repossess the property.
Once the property is repossessed you will be “evicted” and then sadly left homeless. The lender will look to sell the property for a quick sale, possibly at a reduced price and any monies left over are then repaid to you. Whilst this does not happen often, it should be noted that if they do not sell the property and recover enough money to cover the mortgage, you will still be left with a debt to the mortgage company!
What are the Stages?
1-4 months – Payment Reminders: Your lender’s Arrears Collection Department will contact you if you have missed several payments and at this time it may be possible to arrange a way to clear your arrears over a certain period of time if you try to explain to them the reasons why you have not paid your mortgage.
4-6 months – Letter from Solicitors: If your arrears are 4-6 months down the line your account will be handed over to the lender’s solicitors in order for them to chase the monies which you owe.
6 months+ – Court Proceedings: You will receive a letter from the court known as a Summons and it is very important that you reply to this as failure to reply may harm your case. The Hearing will then take place where the judge will listen to evidence from both you and the lender and the decision is then made to:
- adjourn (postpone)
- strike (cancel)
- an agreement is made where you can stay in your home if you pay instalments on the arrears. give you time to sell your property to avoid repossession, or
- eviction.
This is the basic court process:
- Summons for Possession – the first stage of the process. A date and time is given for the hearing
- The Hearing – there are various possible outcomes but the most usual one is the court issuing a possession order, which is usually up to two months
- Bailiffs Warrant – This is the stage at which you could be forcibly removed from your home by the court bailiff after a 14-day notice. At this point, it can be stopped only if you pay your arrears immediately, and in some cases, the whole mortgage loan in full.
If the court decides that repossession is the only alternative a court order will be set for a particular date by which you are due to leave the property. If you have not left by that date then a bailiff’s warrant can be obtained and you will be removed from your home.
How can we Help?
Norfolk Property Buyers has a range of options including preventing the repossession by agreeing to buy your house quickly in time to prevent the repossession occurring. We can also agree to buy your home for the value of the outstanding debt in some cases, leaving you free to walk away debt-free. Some times we can even buy houses in Negative Equity for an above market price.
If you complete the form opposite with details of you, your property and finances, we will then arrange to call you back to discuss your situation.