Repossession occurs when you miss a payment on your mortgage or a secured loan on your property. As soon as you have fallen into to arrears you should contact your lender and follow this up in writing. The earlier you take action the more options you will have and the less you will have to pay in legal fees.
The Repossession Process has a number of distinct stages:
STAGE 1 : Letters from your lender If you have failed to make payments on your mortgage then you will receive a letter from your lender letting you know you have missed payments and asking you to rectify the problem.
STAGE 2 : Court Summons If you have received a court summons, then you must reply to this otherwise it will harm your case.
If the repossession order is made and you do not leave by the set date, a bailiff's warrant can be obtained and you will be removed from the property.
STAGE 3 : Repossession
When you leave the property you must bear in mind that it will be sold on and therefore. Any damage caused will be classed as criminal and the cost of repairs will be taken from sale proceeds. If repairs are not done then it may impact the price of the house when sold.
When your house is repossessed - what happens to it?.
The property will be sold to pay off the mortgage. This is achieved by auction or traditional estate agent.
The lender has a legal obligation to achieve the best possible price, but it will likely be less than the market value. Usually the property will go through an estate agent first, if that fails then it will go to auction where the value will probably be massively lower.
The sale price is used to pay off the mortgage, if there is surplus then you should receive that, but if the sale did not raise enough to pay off the mortgage then you are legally bound to pay the difference.
Any solution to stop Repossession?
A common solution is to sell the property quickly and this is where specialized property companies come into play where they can buy your properties within days, hence stopping repossession. You can have a quick house sale, turning your property into cash.