Credit Crunch

A few facts about home repossession

First, there has to be a valid legal reason for your mortgage lender to repossess your home. The most often cited reasons are mortgage arrears, failing to pay loans secured on your home and bankruptcy.

If a home owner doesn’t keep up with the mortgage repayments or a secured loan, the lender can instigate legal action to repossess and sell off your home in order to recoup their money. Even if you’ve kept up to date with your mortgage payment, you could still lose your home if you default on payments for your secured loan.

Often, just two months of arrears is sufficient for your lender to take legal action but most lenders will try to help you make an arrangement you can afford and will avoid taking proceedings if possible. That said, if the lender thinks that you won’t be able to keep up with the arrangement then they will almost certainly want to repossess.

However, your lender can’t just evict you; they must follow certain procedures and obtain a court order requiring you to leave the property. In many instances, even in the last stages and right before eviction, the repossession can be stopped so if you’re faced with repossession, talk to a free adviser or agency immediately.

Don’t be scammed by one of the companies who offer to buy your home for you or offer you a loan; often, you’ll still lose your home. Talk to people who will give you genuine, unbiased and free advice. Charity group Shelter can offer help and advice as you’re your local Citizens Advice Bureau.