If you’re in mortgage arrears, you need to know at least five ways to stop repossession in the UK. Mortgage arrears is a homeowner’s nightmare. If you don’t pay your mortgage, it may lead to the loss of your home. If you can’t repay the lender the terms of the mortgage loan, the likelihood of house repossession increases when you don’t make timely installments.
Generally speaking, lenders don’t begin a reclamation process until you haven’t paid installments in the past 90 days. Some may give you up to six months before initiating proceedings. If these periods are in process or they’ve elapsed, consider: 1) getting a repossession loan, 2) sell your house before the bank repossesses it, 3) allow voluntary repo, 4) get legal help to delay house repossession, or 5) sell your freehold if you’re going through the recapture process.
#1: Get a Repo Loan
The reclaim process can be put on hold when the borrower agrees or makes payments that are past due. This helps the borrower to maintain control of the property and provides time to either make a sale at market without accepting a reduced price. A repo loan, or bridging loan, can give you time to restructure financial matters.
Stop repossession with a bridging loan. Proceeds can be used to pay mortgage arrears even if you’re faced with a repo of your property. If there’s enough equity in the property and your plan is reasonable to the lender, apply for a bridging loan now. However:
• Recognize that it’s more challenging to refinance debt in today’s financially prudent environment if you have credit problems. If you have bad credit, the lender may demand sale of the property as an acceptable exit route.
• Many bridging loan providers may demand that the property is placed for sale to show that the borrower intends to repay the bridging loan by any means necessary.
• The cost of a bridging loan is an added expense. Depending on your situation, it may be a good option to get out from under mortgage arrears.
For repossession loans, we recommend TIC Finance – a brilliant service to help you stop repossession mortgage
#2: Sell Your Home Yourself
You may decide to sell your property is you can’t pay the arrears or keep your mortgage loan repayments on track with the lender. If you sell the home yourself, it’s also possible to get a better price for it while it's occupied. You can also save on costs by selling your home yourself.
Before taking this step, get a free property evaluation. It may help you to determine if selling the property is the best option. Some estate agents offer free valuation services. Contact estate agents to learn how much your home is worth. Without this information, you can’t know if selling your home will help pay off current debts. For example, if your home has negative equity, the decision to sell probably won't help you raise cash.
If you sell and a shortfall results, you're legally responsible for the debt for up to 12 years. The clock can reset to a new 12-year period if you respond to requests from the Council of Mortgage Lenders within the first period.
You can also use online resources to check how much other homes in your area have sold for, track price trends, determine an estimated selling price range, learn about forecasts for the housing markets, and compare local home asking prices.
Our recommended experts: TIC Finance again – they buy properties and can also offer loans in special circumstances. http://www.ticfinance.co.uk/sell-house-fast/
#3: Voluntary Repossession
The decision to leave your home and return the keys to your lender is considered a voluntary repo. Do this only as a last resort. If you return the keys, your debt continues to increase until the home is sold. This step may make it much more difficult to get a mortgage later. Request help before you agree to voluntary repo. You may have a better option.
Consult a housing adviser and contact the housing council. You’ll probably be homeless if you give back the keys to the lender. If you ask the council for public housing, it may decide that you’re intentionally homeless because you didn’t pay a mortgage as agreed.
Let them know of your particular circumstances. For instance, if you or a partner became ill or parted ways, a housing adviser can present your facts to the council. He or she will let the council know you did all you could to keep the property. Take this step even if you don’t agree with the council’s findings.
Know that even if you’ve already said you’ll give back gets to the lender, it might not be too late to get other help with your mortgage arrears problems. Don’t give up.
#4: Get Legal Help to Delay the Loss of Your Home
Recognize that court action to reclaim your property is usually the lender’s last resort. If the lender contacts you about secured loan arrears or mortgage arrears, respond immediately. If the lender can’t reach you by phone or letter, it’s more likely to take you to court. The best next step is to discuss the matter with the lender. Explain your financial situation and outline steps you must take to bring payments current.
Contact a housing or debt advisor if you’re served with notice of possession hearings. Even if your lender has taken this step, it’s not too late to present a tailored household budget to the lender. The bank or lender will be more inclined to help you keep the property if it’s clear you’re receiving legal help and debt advice.
If a possession hearing occurs, the judge must determine if you can afford to own the property. The hearing doesn’t automatically result in the loss of your home. Realize that even if the lender publishes an eviction date, it’s still possible to solve the problem.
A legal adviser can provide specialised information about the repo process. It’s possible that the legal adviser can help you and the lender arrive at a solution before the judge hears the case.
We recommend getting in touch with Phil Martin, who’s helped a lot of homeowners pro bono – http://www.philmartin.co.uk/stop-repossession.html
Or get more help and repossession articles at Stop Repossession Today – http://stoprepossession.today/
#5: Sell Your Freehold
When you own the freehold, you own the building structure and the land the building stands upon outright and in perpetuity. Your name as owner is listed in the land registry as the freeholder in ownership of the title absolute. You may sell the freehold on your property to another person if you own it.
In most instances, if you own the freehold, you decide changes made to your house and real property. Most financial experts say that owning the freehold is more advantageous than not owning it because:
• A freehold home or a flat with a percentage share of freehold is typically more desirable than a leasehold property. It tends to have a higher value at market.
• A freehold property isn’t subject to changes that a landlord may apply.
• The owner of a freehold isn’t required to interact with a landlord at all. He or she has responsibility for the home or a percentage share of the home or property.
• A new buyer may consider owning the property freehold as an advantage.
• Purchasing the freehold includes serving the current freeholder with a Section 13 notice. When the freehold is purchased, an underlying lease can be extended up to 999 years.
If you own the freehold, ask for a valuation before making a decision to sell. Conversion of the property to a leasehold lets you release cash. It’s not always easy to complete the sale of the freehold but, when accomplished, the cost of the freehold can be high. Liquidating the freehold can help the mortgagor raise cash.
We recommend giving Freehold Sale a call – http://www.freehold-sale.co.uk/
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