Repossession is a legal process whereby a mortgage lender or other loan provider takes possession of a property after the owner has consistently failed to meet the repayment requirements.
It is typically a last resort for lenders, but represents an extremely stressful time for the borrower. Unfortunately, repossessions are on the rise in the UK, with 2022’s final quarter reporting a 134% increase on the year before.
We’ve previously explored the repossession process on this blog, including what you can do if you are facing repossession. There are a range of steps you can take in this position, but if all else fails, you can choose to sell your home.
However, there are many factors to consider before taking this step. Let’s take a look at the process, and consider whether it’s right for you.
When should I consider selling?
If you’ve received a repossession warning from your mortgage provider, you’ll inevitably find yourself feeling stressed, scared, and overwhelmed.
However, it’s important to stay calm and consider your options.
A repossession warning doesn’t guarantee that you can’t regain control. There is a chance your mortgage provider will be willing to renegotiate your repayment terms.
However, if you can’t come to an agreement, it might be time to consider selling your home in order to stop repossession in its tracks.
If legal action is looming, you’ll need to initiate the sales process as quickly as possible to retain control of the situation and ensure your property sells before your lender begins the eviction process.
Will selling my home rid me of all debt?
This completely depends on how much money you owe, as well as what your home is worth and how much you’ll receive from the sale.
If the funds from the buyer are enough to cover your outstanding debts (including your mortgage), you may technically make a profit. However, if the final sale price doesn’t cover the full cost of your mortgage, you will still have to pay back the full amount.
What does my mortgage lender have to do before they take me to court?
Your lender can’t immediately begin proceedings against you for late payments.
issue an eviction notice once you’re behind on your payment.
Instead, there is a set process to follow before they can initiate a court case. They must provide detailed information regarding your debt and propose alternative repayment options.
In the meantime, you shouldn’t immediately return your keys to the lender once you are behind on your payments. This is called voluntary repossession and can affect your credit score, as well as your options if you choose to seek housing assistance from the council.
Your lender cannot immediately request you surrender the keys – they must follow the legal process and obtain a court order before they can enforce an eviction.
Take control by selling your property yourself to stop repossession
If your property is repossessed, your lenders will want to recoup costs as quickly as possible, meaning they may try to make a quick sale at auction.
If this happens, you’ll be liable for their legal costs incurred during the process, as well as arrears, penalties and any fees associated with selling the house. If this happens, you might still find yourself indebted to your lender, as well as bearing a repossession in your financial history.
On the other hand, choosing to resell yourself can not only allow you to settle your arrears, but you’ll also avoid future financial issues caused by having a repossession on your record, as this can make it extremely difficult to get credit in the future and could impact your chances of owning another home again.
Looking to Make a Quick Sale?
Selling your home can be the solution that puts you back in control, but traditional sales routes can take a long time, extending the anxiety of the process.
With a cash buyer like Zoom Property Buyer, you’ll get a fair price for your home in exchange for a swift sale. We’ll work with you to help you avoid having your home repossessed and helping to put you back in the driver’s seat.
The decision to sell your home in these circumstances is deeply personal. But if you choose to sell with us, you’ll be met with professionalism and compassion. For more information or to get started, don’t hesitate to contact our team today.