Curing the Debt Nightmare: How to Deal with Home Repossession

Experiencing home repossession because you failed to make mortgage payments on time is often a stressful and challenging experience. According to the Ministry of Justice, in the period from October to December 2022, lenders reclaimed a total of 733 homes.

Therefore, it is crucial to act quickly and seek expert advice if you find yourself in such a situation. So, keep reading to find out what steps you can take to stop repossession from occurring.

Prioritise Paying Your Mortgage

Paying your mortgage is usually the most significant financial responsibility you have. Failure to make timely payments can result in severe consequences, such as losing your home. 

To avoid this, you should prioritise your mortgage payment over non-priority debts, such as overdrafts and store cards. Also, it would help if you tried to pay as much as you can, as this will show your lender that you are making an effort to make things right. 

Talk to Your Lender

Being honest and transparent is crucial, as lenders tend to negotiate and find a solution that works for both parties. That’s why you need to explain why you’ve missed your payments, what steps you are taking to repay the arrears and when you plan to start repaying them. 

Obtain Legal Advice

You should immediately get legal advice if you receive a letter regarding potential legal action or a court date. The legal expert can help you understand the right and obligations you have as a homeowner and guide you through the legal process.

They can also represent you in court hearings and help you reach a positive outcome. Additionally, if you are unable to afford a lawyer, you can go for legal aid, which is free. 

Get Money and Debt Advice

Money and debt advisors may come in handy if you are facing financial issues. They can provide you with tips on how to manage your finances, such as creating a budget strategy that will help you prioritise mortgage payments. 

Furthermore, they can negotiate with creditors to reduce monthly payments and help you deal with non-priority debts. As a result, money and debt advisors will help you avoid falling further behind with payments and stop repossession.  

Apply for Help at Home Owners’ Support Fund

The Home Owners’ Support Fund government helps you if you struggle to pay your mortgage and face the risk of repossession. The fund offers support through interest-free loans, debt write-offs and grants.

To apply, you should contact your local authority or support provider, provide evidence of your income and financial issues and fulfil specific criteria like low income, an unexpected change in circumstances, or some kind of illness or disability.

Sell Your House

Selling your house should be your last option, but it is still a way to settle the debt and avoid repossession. 

If you do it on your own, you can earn more by making a better deal that will cover your mortgage costs. However, if the sale doesn’t cover the mortgage amount, you must get your lender’s approval for selling it.

On the other hand, if you decide to let the lender sell your house, you are still obligated to pay the mortgage costs until they sell it. 

Conclusion

Stopping house repossession is challenging yet possible. By taking early action and following the steps we’ve provided above, you will improve the chances of keeping your home and avoid the negative consequences of repossession.