How to Stop Repossession?

Mortgage lenders will begin the repossession process if you are in more than three months of mortgage arrears without an agreement to repay the money that you owe. Although it may seem like you have no choice there are still options available to you, here are the ways that you can stop repossession even once you have fallen into arrears.

Stop Repossession by Paying Your Mortgage Arrears

If this is an option, this is the best, most straight-forward way of halting the repossession. Communicate with your lender if there has been a misunderstanding or a bank error and you should avoid late charges. If the problem has not been a bank error but a temporary cash flow problem you can also speak to your mortgage lender and arrange to pay the arrears over an agreed time. Be advised that this is an informal agreement and you can still be asked to pay the outstanding payments in full at any time. The best way to avoid this is to remain on good terms with your lender, don’t delay or miss any payments and if you run into any problems contact them immediately.

Stop Repossession by Remortgaging

If you really can’t afford your current mortgage repayments but don’t want to lose your home, you could also think about remortgaging your property. By switching to an interest-only mortgage you would release the equity in your property to pay off your mortgage arrears and reduce your monthly repayments to suit your current financial situation. However if you are considering remortgaging you should be aware that there may be administrative charges and higher lending rates for changing your mortgage deal, which may mean that you end up in more debt.

Stop Repossession by Selling your House

If your financial situation has permanently changed then you need to consider more long term options, for example selling your house and buying or renting cheaper accommodation. You could use an estate agent, where you will receive the full market value to pay off your outstanding mortgage and then look for a new property. However if you have already fallen into arrears a long, drawn out sale could be costly especially where there is no guarantee that your house will even sell. In this circumstance the benefits of receiving a higher price for your house could be outweighed by the cost of your debt and mortgage repayments mounting up.

The other option is considering selling your house using a quick-sell cash buyer. Because they guarantee a quick, cash sale, you will be selling your house at around 70-75% of its market value. In return you get a fast, hassle-free sale. Most importantly the speed ensures that you can quickly pay off your debts and your mortgage and avoid being credit black listed. If your house was repossessed it would be very difficult for you to get another mortgage for a house, but this way you can clear your current mortgage and then consider buying a less expensive property with the equity released in the sale.

Stop Repossession by using a Sell and Rent Back Scheme

You may not want to move from your home but be unable to afford your mortgage repayments: even then there are still options available to you. By using a Sell and Rent Back Scheme you can sell your home and then rent it back, allowing you to clear your debt and still stay exactly where you are. Using an FSA approved firm gives you a sense of security and both the sale price and the rental price can be agreed before hand so you know exactly what is going to happen, without any hidden costs or nasty surprises.