The Repossession Process

There are many reasons repossession
can happen to people in life, even if we try to keep our finances in order, circumstances can occur which makes homeowner debt just stack up and before long we find ourselves in arrears without debt repayments.
Managing our finances can be affected by a whole host of reasons, a death of your partner or a marriage breakdown might leave you on your own trying to cope. You may have to stop working, whether it is from illness, an accident or being made redundant making it difficult to keep up with payments. Interest rates can rise which make mortgage repayments more than what you can afford.
As most people know if you don’t keep up with your mortgage repayments, you are at risk of your house being repossessed.
For a property to be repossessed there has to be a legal reason, the most common being falling behind on mortgage repayments or loans secured on your property.
If you do find yourself falling behind with your mortgage repayments, then the first thing you should do is to contact your lender and come to an arrangement on paying back the arrears. Some people ignore the letters and calls, but it is very important you talk to them and work something out; as they want to help you stop repossession by coming to an agreement.
The 5 Stages of repossession
Stage 1
After you miss more than 2 months of mortgage repayments, your bank or building society can start the repossession process. But in most cases the banks debt department will contact the customer and try and work out the problem and come to an arrangement where the arrears are cleared without court action. It is important to then keep up with the terms of the new agreement.
Stage 2
If the arrears are still not paid, then the mortgage lender or their legal department will write to you warning of court action that they will start shortly after. They will then apply to the court for a repossession order.
Stage 3
The court will make a summons, which is when they contact you with the date that the hearing will take place on. At this stage the best thing to do is to seek advice from a professional and to reply to the court as soon as possible as it may harm your case if you don’t.
Stage 4
The next step is to attend the hearings, as if you don’t the judge will almost certainly award the possession order against you as you have failed to show up and give evidence.
If you do turn up to the hearing, the judge will listen to evidence from you and your lender before making the decision. Here are the following outcomes of a case:
Case dismissed – this happens if the arrears have been paid off so the repossession stops.
Case adjourned – This is when the hearing is postponed for a whatever reason, meaning the hearing will be rescheduled for a later date
Suspended Possession Order – If you agreed to pay the regular monthly payments as well as an amount towards the arrears for each month, then the judge can suspend the possession if he is convinced that you can make these payments. If you default on the agreed terms, the lender can seek possession by eviction or possession warrant without a further hearing.
Possession order – This allows the lender to take possession of your property after the possession order date. This result usually comes about if the judge finds out you haven’t contacted the lender or the court, or if he believes you cannot afford the payments you have agreed to.
Stage 5
If you don’t make the payments agreed to in the Suspended possession order or you have not moved out after the possession order date, the lender can apply for a warrant of eviction notice. This means you will get a letter telling you, that you have 7 or 14 days to leave the property. On the date you are meant to leave a bailiff will arrive to take possession.
Another solution if you have mortgage errors or are facing repossession already is selling your house with a quick property sale. There are companies like Properties Direct Ltd that can offer cash for property. They have the in-house resources and funds to stop repossession even if you have been sent a possession order.
If the bank does repossess your property, you could still be left with negative equity because the sale price they accept might not cover the outstanding debt. The bank will sell the property as quickly as possible to reduce any loses this is typically far less than the market available of your property.
Companies like Properties Direct Ltd
can buy your property and guarantee a quick sale. This will avoid the uncertainties of the housing market, stop repossession and ensure you receive a fair value for your home.

Ashley Gilmour has wrote this article on behalf of Properties Direct Ltd