The law on repossession and how to avoid it

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Repossession Laws

All mortgages and remortgages are secured against the house you are buying. A good selection of loans is also secured against your property. The lender will have a clause in the credit agreement that will state along the lines:

'Your home is at risk if you do not keep up with the repayments agreed.'

This is called a legal charge and protects the lenders investment in you. This also covers them if you sell the home before you have fully paid off the advance. It will also state that you have to pay the outstanding to them first when you do sell.

If you default on repayments, they can, by going through the correct channels, repossess your property to recoup any outstanding monies owed on the property.

If any money is left over it will be repaid to you.

Most lenders will first apply to the court for a "Possession Order" to allow them to take over the property if you are in "arrears".

Firstly, your credit supplier should contact you to discuss the reasons why you have fallen into arrears, and will try to organise a solution with you. Failing this, they will then have to notify you in writing that they are going ahead with legal proceedings to regain ownership of the property.

They then have to apply to a county court to start proceeding against you. This used to be a timely exercise, and could take between four weeks to six months to get the wheels in motion. In recent times, with the advent of the Internet, they can now do this online. This has speeded up the whole process.

Once in court, they will explain to the court why they are seeking a repossession order, and if the judge agrees, then a notice will be served to you.

You will be given a date of repossession.

Not only does this live you homeless and looking for somewhere new to live, but you are still liable for all costs incurred until the repossessor actually sells the property and recoups their loan. This means, that they take out their slice, then, what ever is left, goes towards, the legal cost, estate agents fees etcetera, etcetera. If at the end of this, there is any honey left in the pot, you will receive this.

Not only do you lose your home, but your credit rating is ruined. You will find it almost impossible for at least two years to be able to get any credit in any form. After this period, the interest rates you will be charge will be in line with your credit history.

We can help you avoid all this. A quick house sale can cut out all the heartache and headaches of this procedure. You can pay off all your creditors AND we even give you the option of renting back the property with the sell and rent back solution.

Simply fill out our online enquiry for, give us a call on 0845 621 5000 or send an email to sales@quickhouse.co.uk to see how we can help you out of this situation.

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