Have you found yourself in a financial bind? Need to sell a house to avoid your repossession? Learn about the process and your options to stop repossession.
Have you found yourself in a financial bind and need to sell a house to avoid and stop your repossession? Maybe you’ve even asked yourself, Can I sell my property to avoid repossession? While each situation is different, in most instances you can avoid a repossession altogether. There are some ways to sell a house to avoid the repossession process. Repossession can affect your credit score causing you future problems if you are looking to borrow. Repossession can affect more than just your credit, it can be stressful and humiliating. However, you do have a few options available, this article aims to outline them, along with summarising the repossession itself. Read on!
What is the Repossession Process?
Many people do not understand the repossession process. Honestly, they just want the answer to the question: Can I sell my house to avoid repossession? The goal, of course, is to avoid the repossession, if at all possible. Repossession is usually the build up of missed payments.
1st Missed Payments:
Maybe you got made redundant, got laid off at work, lost your job, lost a second income, or simply hit a difficult point financially. It happens to everyone at some time or another whether it’s illness or job related, and a few house payments go unpaid. Within 15 days of each missed payment, you should receive a letter. Most lenders can be flexible about the odd missed payment.
3rd Missed Payment
Once you have missed three mortgage payments and are 90 days behind on mortgage payments, lenders generally look to commence the repossession process. However, most banks don’t want to repossess, they’d prefer you to repay. The Financial Conduct Authority expect banks to work with you to try and find a solution . If however, you can’t afford to pay your mortgage and you choose not to communicate with your lender they are more likely to repossess your house away more quickly.
Pre-action protocol: step before court action
If you have missed payments for 3 months then the lender will start to take action against you. To do this they must adhere to the Pre-action protocol set out be the Financial Conduct Authority. This requires the lender to provide you with a range of prescribed information, to help make clear the amounts owed, potential options and the next steps if payments are not made. The next step after this is court action.
The next step is for your lender to apply to court for a repossession hearing. At this hearing the lender will outline their case to repossess your property. There is still the opportunity to stop the repossession if you can make a payment or suspend the repossession action if you have agreed to the sale of your property.
How Does Repossession Affect a Homeowner?
One reason many people want to sell a house to avoid repossession is that the repossession affects a lot more than just your credit rating. In most instances, after a home is lost through repossession, the individual’s credit score drops significantly. It can take many years of making on time payments to restore the initial credit score. Besides its devastating impact on your credit score, there are other areas affected. These include:
- Buying another house – After a repossession, it can be very difficult to purchase another house. Some lenders only require a waiting period, others will not make a loan to a person who has been through repossession making getting a mortgage very difficult.
- New Jobs: In most instances, a repossession may not affect your job or ability to get one. However, it may mean you can’t work in the financial industry such as in a bank if you have poor credit ratings.
Can I Sell a House to Avoid Repossession?
Have you been thinking Just stop my repossession?! You have options. There are always options, even if you just want to sell a house to avoid repossession. Look at the options you have available to see which one will work best for your situation. Every individual situation is unique, and finding an option may take creativity, but there is always a way out of a foreclosure. Here are some options to explore:
Discuss refinancing options with your lender.
You may have some refinancing or mortgage modifications available that can help make your payments more manageable. In some cases, depending on finances and other criteria, lenders can lengthen the time you pay while reducing the amount you pay. This modification helps keep you in your house. However, before they make modifications, the lender may require that it be brought up to date. That may present a challenge.
Sell to a cash buyer.
The best option for homeowners who want to sell a house to avoid repossession just might be selling their house to a cash home buyer. The process is actually a simple one. The cash buyer takes a brief look at your house and then makes a cash offer. If you are comfortable with the offer, they give you the cash and complete the paperwork for the sale. Closing usually takes as little as a week since it is a much faster process. You’ll be able to pay off any mortgage. It really is that simple. You do not have to show the house, prepare the house or make any repairs as a cash buyer is an investor and will take the house no matter what its condition. No preparations are necessary.
Want to Avoid Repossession?
At K&G Lettings Limited we specialise in a quick house sale. We understand that facing repossession is a scary and stressful time for you. We can take the extreme stress away by buying your house. At K&G Lettings Limited, we specialise in buying houses quickly and without hassle. This removes the emotional and financial hassles form facing a house repossession, ensuring you and your family can face the future without fear.
Even if you don’t decide to sell, we’d love to answer any questions you might have. Give us a call today on 01482 961961.
The information presented in this article is for educational purposes only and should not be considered legal, financial, or as any other type of advice.