Stop Repossession – The Process & Your Options

Most people know that falling behind with their mortgage payments is going to put them at risk of having their home repossessed. But almost every situation is different, so missing a couple of payments doesn’t necessarily mean you will be out on the street immediately, there are various steps your lender has to take before you will lose your house. So if you are struggling to keep up with your monthly payments, what’s likely to happen, and what can you do to stop repossession from becoming a reality.

The first thing you need to do if you are getting into debt, even before you’ve missed any payments, is to speak to your lender. Banks know what effect the credit crunch has had on homeowners, so you might be surprised at how keen they are to help. Letting them know you’ve got problems as soon as possible is one of the best ways to stop repossession, and the bank might be able to rearrange your lending to help you out of your current difficulties, and to make sure the problem doesn’t get any worse.

If you make a new agreement with your lender, it’s important that you are able to stick to it – they’re unlikely to keep negotiating, and it will be harder to stop repossession, if you keep letting them down. While most lenders are usually quite helpful, if you feel your bank is treating you unfairly, you have the option to complain to the Financial Services Authority, but this is unlikely to be a quick solution and unless you keep up your payments, your problems could get worse while you’re waiting for help.

If you continue to miss your monthly payments, or fail to keep up with any new arrangements you’ve made with your lender, it’s going to get a harder to stop repossession, but you still have some options, as lenders have to follow certain steps to make sure repossession is always a last resort. Once they’ve made it clear how much you owe them, and given you the opportunity to provide any information to help them understand your situation, if they are not prepared to accept your repayment arrangement, they have to let you know in writing. They also have to give you enough time to respond to any arrangement they suggest.

If you can’t reach an agreement with your lender, they might then resort to legal action to gain possession of your house. However, it is possible to postpone legal action for a number of reasons; if you have made a genuine complaint to the Financial Services Ombudsman, you have a mortgage payment protection policy that is due to pay out, or you are taking steps to sell your property at a realistic price. Whilst these steps might not stop repossession, they may slow the process down, to give you more time to find a solution.

If you are unable to prevent your bank from taking you to court, you should still explore all your options, even up until the court date. Even if you end up in court, the judge may still decide in your favour if you can provide a suitable defence, for example, if the lender has been unreasonable, you meet the court’s arrangements to repay the arrears, or you need more time to sell your home. If the court decides that you do need to leave the property, there might not be much else you can do to stop repossession, but with a clearly laid out process, designed to help the homeowner as much as possible, you should hopefully have enough chance to prevent it getting that fair.