The Finance Blog

There is no doubt that keeping up the monthly repayments on various debts coupled with the price of modern living can be a very difficult task. When it comes to debt repayment on a mortgage or secured loan however; not everyone prioritises these repayments over every other form of debt. This can of course have serious consequences - the worst case scenario being property repossession.

Falling into mortgage or secured loan arrears can be caused by many different factors - In the majority of cases this can happen due to a relationship breakdown, accident, sickness or unemployment. Another common factor of course is as previously mentioned - having high levels of consumer debts and outgoings. This can have a snowball effect in the way that one or two missed payments on a credit card or store card can make its way down to the more important commitments such as the mortgage or secured loan (where applicable). For the majority of individuals, the monthly mortgage repayment represents the largest single outgoing. For this reason, there is a very real temptation to free up the money allocated to pay the mortgage in order to alleviate other more seemingly pressing commitments.

Even when the circumstances seem at their most dire, many borrowers may be surprised to discover the many different courses of action that may be taken to stop the problem from escalating and ultimately; preventing repossession of the property. The majority of these options may be open to you at the discretion of the lender such as; term extension, capitalisation, payment holidays and payment plans.

Another option to consider is that of a remortgage. Where you have available equity within your property and an ability to satisfy affordability criteria, a remortgage can offer one of the most effective ways to combat the problem of repossession.

Even with a possession order, it is still possible to save your home. In most cases, where a possession order is granted to the lender by the courts, the homeowner is given 28 days to make arrangements to vacate the property in question. It is in fact possible to prevent any imminent eviction by way of repaying back the debt to the lender, inclusive of any arrears and charges. Even if a property has been repossessed by the lender, the amount owed may still be paid back immediately prior to the property being sold.

Without taking decisive action in these situations, repossession is not just a threat that faces the borrower but a very real possibility. Even with children, a court is not likely to make such exceptions very often.

In the initial stages of mortgage arrears there is a temptation for many to bury their heads in the sand. This mentality will include ignoring phone calls and emails, not opening the post and so on. This is not widely regarded as a sensible approach to such situations. Losing a property to repossession is a devastating experience and one in which can be avoided in most situations - regardless of the underlying reasons behind the mortgage arrears. It is important to obtain professional help at the earliest opportunity. As little as a just a couple of missed payments can be enough for a mortgage company to start repossession proceedings.

  

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