Avoid Repossession
To have your home repossessed is one of the most stressful things that can happen to a family, putting adults and children alike under enormous pressure. The financial impact is often severe and long lasting, affecting individuals’ ability to obtain loans, credit and mortgages in the future, and sometimes leaving them with debts that need to be repaid without an asset against which to secure them.
The Council of Mortgage Lenders (CML) expects to see a dramatic rise in home repossessions this year but stresses that its members view repossession as a last resort. The Financial Services Authority, which regulates all lenders, requires policies to be in place that offer alternatives to repossession wherever possible. If you are facing the threat of repossession, ask your lender to see their arrears management policy and if you don’t understand it, request an explanation. They have an obligation to treat you fairly so if you don’t think this has happened you should take advice on what to do next. Start by talking to your lender, but other agencies such as the Citizens Advice Bureau and the National Debt Helpline will be willing to provide you with free advice.
But it’s also up to you to help yourself. The CML strongly recommends that you get in touch with your lender as soon as you start experiencing financial difficulties that mean you can’t pay your mortgage. If you let your lender know what’s going on, they are more likely to be able to help you manage your loan.
Property Rescue offers ways of avoiding repossession for those who have no alternatives and are under threat from their lender of losing their home. There are two schemes that are available:
- Selling Up
Although no one wants to sell their home under these circumstances, it is almost always preferable to the alternative of repossession. Selling will not realise the full market value of your home, but it will provide a realistic price, a guaranteed sale and leave your credit rating intact. - Sell and Rent Back
These schemes have come in for criticism in the media recently on two counts: firstly that the value offered by ‘sell and rent back’ providers is too far below market value, and secondly that the terms of the rental agreement are not explained clearly to the sellers. Property Rescue guarantees to make all the necessary information available to you up front so that you have a chance to ask questions, take independent advice if you wish, and come to your own decision. No pressure is put on you to proceed if you decide not to. They make no secret of the fact that the market value of your home will not be achieved by selling in this way, but in a sliding market many people feel this is a sacrifice worth making. The sell and rent back scheme from Property Rescue allows you to stay where you are and lifts the threat of repossession.
One thing all parties are agreed on is that it is never a good idea to avoid repossession threats. They won’t go away and they need you to take action. For information on either of the schemes outlined above or an informal chat with the team of experts, simply call Property Rescue.
