How To Save Your Home From Repossession

by: JamesBailey
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Your account with your lender is "in arrears" when you have missed some mortgage payments for whatever reason. Once you are in arrears, having missed payments for a couple of months or more, your lender is likely to seek court action in order to take steps to regain ownership or "repossess" your property. If you fail to contact your lender and try to reach agreement, the lenders only option to get their money back is to take control of your property and sell it. They must do this through the courts.

The important thing to recognise as a homeowner threatened with repossession is that there are options to consider. If a lender takes action through the courts it does not mean that you will definitely lose your home. Refinancing your home may help, or you could always sell. Getting friends of family to help with the arrears is a further consideration.

Getting in touch with your lender is strongly advisable. By making contact you are giving yourself and the lender a chance to find a solution that is suitable for you both without the need for court. Some lenders are willing to help and can offer a number of solutions e.g. switching to interest only payments or increasing the term of the loan. Whether you can reach agreement with your lender will depend on your circumstances, but a judge will be more synmpathetic if you can show you have at least attempted to reach a solution.

Going to court, if matters reach that stage, may not be as daunting as you might think. Hearings about possession are held in private rooms in the county court with a judge. A legal clerk will be there to represent the lender and the hearing generally takes about ten minutes. There are no black gowns, wigs, public galleries, witnesses or a jury. Its your opportunity to explain what has caused your account to go into arrears and try to reach an agreement so that you can keep your home and continue to meet any revised payment obligations.

At the hearing the judge will be looking to identify what you can do to pay off the arrears and meet your commitment for the normal monthly payment. You could offer to pay off all or a significant sum towards the arrears. Clearing the arrears will mean the lender has no reason to possess the property. Another option is to offer to meet further monthly payments in full, with a contribution towards the arrears. In this case the judge may grant a suspended possession order allowing you to keep your home provided you meet this commitment. Whether the judge is likely to grant extra time for options such as refinancing or selling your home will be dependent on how far these have progressed.

Refinancing your home may be an option worth considering. However, in a repossession situation time is of the essence and the broker may not have any control over timescales or being able to guarantee you will be able to get the refinance you need. The fact that you are in arrears will also limit the availability of finance to you and the long term cost is likely to be very high. Selling your home is a further option but again beware that you will have very little control over the timescales and it may take time for an offer to be made and for the buyer to get the finance they need to buy your property.

A suspended possession order may be granted at the court hearing by the judge. This will allow you to stay in your home provided you adhere to any terms that the judge has stipulated. For example, this may be to make full monthly payments in future together with a small contribution towards arrears. The judge may also suspended the order to allow you to follow through with any other proposal you have e.g. refinancing your home or selling it. If you fail to convince the judge to suspend or waive the order then the lender will be granted possession and you'll have a matter of a few weeks before eviction.

Facing repossession is every homeowners worst nightmare. However, recognising that their are options available and that there are organisations available to help you is important. What's critical is taking some action and seeking help. Organisations such as Shelter, the Citizens Advice Bureau and the National Debtline are good starting points for advice, Make sure you are contacting these government supported agencies or charities and not some copy cat private enterprise.

About the Author

Author James Bailey has a good working knowledge of the repossession process and has helped numerous people save their home in the UK. Find more information, articles and obtain a full report on the repossession process at www.repossessionhelp.info  

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