Home repossessions are unfortunately on the rise. According to data from UK Finance, 440 buy-to-let mortgaged properties were repossessed in the second quarter of 2023, which was 7% more than in the previous quarter. This is due to in part the rising cost of living, and the interest rate rises which have seen mortgage costs soar and unaffordable to so many.
Repossession can affect people from all walks of life. Most of us are only two or three missed payments away from potentially losing our homes, so knowing what you can do to mitigate or even stop repossession is important.
Many people turn to cash house buyers when faced with repossession and as you’ll see this is an option that could be of benefit to anyone who is under threat of having a home repossessed. If you want to sell your home quickly, give us a call today at We Buy Any Home, as we can buy Birmingham homes quickly, saving you time and money.
The Repossession Process
Luckily, you cannot just be thrown out of your home, even if you are a tenant. There is a fairly lengthy process that must be adhered to, which can be summarised as follows.
Phase 1
- Your mortgage lender is obligated to tell you how much you owe and must consider any offer of payment or request to change your payment method.
- The lender must provide a 15-day written warning before initiating court action.
- Even after the court action has been initiated, there is still an opportunity to negotiate with the lender.
Phase 2
- If your lender starts repossession action, the court will send you a defence form, which you must fill out to explain why your home shouldn’t be repossessed.
- You are required to return this form within 14 days.
Phase 3
- If there is no solution, you’ll be required to attend court.
- The repossession hearing usually takes place in a judge’s chambers, not a courtroom, and you are allowed to bring an adult adviser with you.
- If you do not attend the hearing, it’s likely that the judge will grant the mortgage lender the right to evict you.
Phase 4
- The judge will make a decision. The judge has several options: they can delay the hearing, set aside the case, or issue a repossession order.
- Various types of possession orders can be issued that will have different impacts on your ability to stay in your home and your financial obligations.
- You can request the judge to ‘suspend the warrant for possession,’ which would delay the eviction or potentially allow you to remain in your home if you can start making payments again. A new hearing will be scheduled, but the suspension is not guaranteed.
- If you believe that the judge made errors in law or facts, you have the right to appeal the decision.
- You’ll need to pay a court fee to appeal, although this may be waived if you’re on low income or benefits.
How long do repossession proceedings take?
Navigating these stages takes up to nine months, but is often done sooner. The process is generally not a quick one though, and throughout it, there are multiple opportunities to settle any overdue payments. Remember, repossession is a last resort for lenders, so do everything you can to repay and you should be able to stay in your home.
Can I stop my house from being repossessed?
If you’re facing the possibility of home repossession, it’s crucial to take both immediate and long-term actions to protect your property.
- First and foremost, make the settlement of your mortgage a top priority. If you need to put repayment so other debts on hold then do this.
- Explain to your lender why you can’t repay. This could be due to a job loss – if so explain that you are looking for work and once you gain employment you’ll be able to restart payments. It is important to be proactive and show that you are doing everything you can to get back on track.
How many missed payments before repossession?
If you miss mortgage payments for about three months, you run the risk of being investigated by the lender. Generally banks are reluctant to take legal steps unless it’s absolutely necessary, so if you do fall behind, try to get back on track quickly to avoid the situation escalating.
Selling Your Home: Your Options Explained
For some people, selling your home may be the only option you have. Below are some of the options you can consider if you find yourself in such a situation.
Selling through an Auction
Pros
- Speed: Auctions can be the fastest way to sell your home, often completed within 28 days from the date of the auction.
- Certainty: Once the hammer falls, the buyer is legally obligated to go through with the purchase.
- Potential for High Price: Competitive bidding can sometimes drive the price higher than expected.
Cons
- Cost: Auction houses often charge both listing fees and a percentage of the sale.
- Risk of Low Sale Price: If there are few bidders, you risk selling at a lower price.
- Uncertainty: If the property doesn’t sell, you’ll still incur the listing costs.
High Street Estate Agent
Pros
- Expertise: They have in-depth knowledge of local markets and can provide a valuation.
- Negotiation: They handle all negotiations, viewings, and marketing.
- Price: They usually aim to get you the best price possible on the market.
Cons:
- Fees: Estate agents charge a percentage of the property’s selling price, which can be significant.
- Time: It could take several months to sell your home, depending on the market.
- No Guarantee: There’s no guarantee the property will sell or that buyers will secure financing.
Online Cash House Buying Company
Pros
- Speed: These companies can often make an offer within 24-48 hours and complete the purchase in as little as seven days.
- Convenience: They buy the house ‘as is,’ meaning you don’t have to worry about repairs or staging.
- Guaranteed Sale: Once you accept the offer, the sale is almost always guaranteed.
Cons
- Lower Sale Price: These companies aim to buy at below market value, so you might not get the best price.
- Reputation: Not all cash-buying companies are reputable; do your research before engaging.
- Fees: Some charge fees for their services, which could eat into the amount you receive.
Choosing the right option depends on your circumstances, such as how quickly you need to sell, the condition of your property, and how much you need to get from the sale. Take the time to weigh these options carefully to decide which is the best fit for your situation.
If you’re grappling with the threat of losing your property to repossession, We Buy Any Home can help you sidestep that scenario by buying your house outright with a cash offer. As online cash house buyers in Birmingham, the money we provide can settle your outstanding mortgage balance, as long as the offer we make exceeds the debt you owe to the bank. As soon as you reach out to us, we can swiftly proceed to acquire your home, halting the repossession process; our record for completing a purchase from initial communication is just one week. To ensure a smooth process, it’s advisable to get in touch with us as soon as you can, given that unexpected issues may cause delays.
