Taking action on home repossession involves many stages. In fact, you can actually stop the procedure any time. One way to stop is to get advice from a lawyer and negotiate the issues. The following are the seven steps to home repossession that you must know;
1. The financial institution notifies you about a financial debt and repossession
In case you are in a financial debt, the mortgage company will speak to you. They will suggest that you settle the problem immediately. When not satisfied with your answer, or you do not reply to their notice, the mortgage lender will notify you again. They will inform you that the court action will start to repossess your property.
Negotiating the issues with your mortgage lender can help resolve the problems. To negotiate, you have to consider all alternatives. The proposals must be put at the hands of your lender. The negotiation must include mortgage problems. It is very important to contact the lender – thus preventing the repossession process. The lender could help you by following the laws of repossession.
What are the different options to take?
- Pay your delinquencies
- Claim all your benefits to pay your home loan
- Ask the council to provide you some assistance regarding your mortgage problems
- Get Support for Mortgage Interest (SMI)
- Claim a Mortgage Protection Insurance
- Get some help from Government Mortgage Rescue
- Ask for a better deal from your mortgage lender
- Opt for interest-only-mortgage
- Agree for a lower monthly payment
- Take the payment holiday
- Extend the mortgage terms of payment
- Add mortgage arrears
- Get a lower price mortgage offer with other mortgage lenders
- Maximise your earnings
- Rent you property or home
- Sell your home without an agent
2. The lender applies for a repossession court order
Remember, your home cannot be repossessed by the lender if there is no court order. The lender must apply a repossession order from the local court.
3. The court notifies the date of hearing
The date of hearing will be set up by the court. The decision whether you can keep the property or it should be passed to the lender will be determined. The court official will send a notice and inform you about the hearing date. The notice includes;
- reasons why lender wants to repossess the property
- defense form to complete and mail back to court.
Take note that it is important to fill up the defense form and mail back to the court. This time, get some advice from solicitor or housing adviser for the next move. The solicitor or perhaps adviser can help you gather evidences and can negotiate with the lender. If you have a low income, you are eligible for legal aid from the solicitor’s payment.
4. The judges presence on the case of repossession
The decision for repossession is determined by a judge in the county court. Before the decision, the judge will hear evidences from you and the lender.
The role of the judge in repossession hearing
- Make a decision if your home is to be repossessed or not. The lender have the right to sell the property or you may be evicted to repay the mortgage debts.
- Issue a suspended possession order. You are allowed to stay in your home but will abide by the conditions like paying your debts.
- Have the right to adjourn the case. The case hearing can be postponed to another date.
- Have the right to dismiss the case.
5. The judge issues a repossession order
If the court decides that your property is needed to be repossessed, you are granted a possession order. The court will decide the exact date of your eviction. It takes 28 days or more and you have to pay for all the expenses.
6. The Bailiffs are liable to get you out of your property if you don’t move
If you will not leave the property after the exact date of court repossession order, the lender will request bailiffs to get you out of the property.
7. The mortgage lender sells your property or home
After the repossession and moving out of your property, the mortgage lender will sell your home. However, you need to pay for the mortgage interest until it is sold. After the property is sold, the lender will give you the remaining amount of the whole loan.
The above information will guide you through the property repossession process.