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Repossession is when the mortgage lender takes back your property because you haven’t kept up with the mortgage payments. It’s a legal process and usually a last resort for lenders. If you can’t meet the agreed repayments, they have the right to take possession of your home and sell it to recoup their losses.
Selling your home fast helps prevent repossession because it allows you to pay off your outstanding mortgage balance before the lender takes action. You can sell your home and use the money from the sale to pay off any outstanding debt, effectively stopping the repossession process. You also get more control over the selling process, potentially allowing you to get a better price than if your home was sold at a repossession auction. It’s a way to clear debt, maintain your credit rating and avoid the stress and stigma that come with repossession.
Failing to sell your property before repossession means the lender takes control of the sale. They will typically sell the property at auction, which can sometimes result in a lower selling price than a private sale.
As a result, you could be left with a remaining debt if the sale doesn’t cover the full amount of your mortgage. Any leftover balance, known as a ‘shortfall’, is still your responsibility to pay. Plus, repossession has a negative impact on your credit history, making it harder to get loans in the future. It’s best to avoid this scenario if possible.
If you’re grappling with debts and fear losing your home to repossession, Property Rescue can help. We provide fast and effective solutions to buy your property quickly, often exchanging paperwork in as little as 48 hours. It means you will likely be able to settle your mortgage and avoid repossession.
In addition to this, we offer a service that involves purchasing your property and then renting it back to you. Not only does this let you remain in your home, but it also clears any outstanding mortgage debts you might have. If this sounds like a solution for you and you’d like to learn more, our expert team is just a phone call away, ready to assist.
Here’s how it works
There are alternative strategies that you can consider to prevent repossession, but they may take longer. These include:
You might be able to add these arrears onto your mortgage balance if you’ve missed a few payments. This option, known as ‘capitalising the arrears’, spreads the missed payments over the rest of your mortgage term. Going down this route can make it easier to manage the debt, but it could also increase your overall mortgage cost due to additional interest.
An interest-only mortgage allows you to pay only the interest on your loan for a certain period. Taking this option reduces your monthly payments, which can make them more manageable in the short term. However, you’ll still need a plan to pay off the loan balance at the end of the mortgage term. It’s also worth noting that most lenders require borrowers to earn six-figure salaries if they want an interest-only residential mortgage.
Some lenders may allow you to take a mortgage holiday, which is a temporary break from making mortgage payments. A mortgage holiday can provide relief if you’re experiencing short-term financial difficulties, but interest will continue to accrue during this break. So you’ll end up paying more over the term of your mortgage.
If you have an endowment policy – a life insurance policy that pays a lump sum after a specified term or upon the policyholder’s death – you might consider selling it to pay off your mortgage arrears. But selling an endowment policy could mean getting less than the final payout would be, and you’ll lose the life cover it provides.
If your lender permits it, you could rent your home out. The rental income could then be used to cover your mortgage payments. You’d need to move out, but it could prevent repossession.
You might consider renting out a room if you have extra space. Doing so could generate additional income to help meet your mortgage payments.
Should your financial situation improve, making overpayments can help you clear your mortgage arrears faster. Although, some lenders might charge you for overpaying your mortgage. It’s best to check the terms of your mortgage first.
Selling your home to avoid repossession will likely mean you can pay off your mortgage, avoiding the repossession process altogether. It helps maintain your credit score, which could be severely impacted by going through repossession. Selling yourself, rather than through a forced sale, often yields a better price and reduces potential shortfalls. You can also enjoy a fresh start, lifting the weight of a burdensome mortgage, and begin a financial restructuring.
Sell your home with Property Rescue and we'll exchange contracts in as little as 48 hours, meaning you can move within days!
With Property Rescue, you get a speedy sale, guaranteed. We'll even loop in with your onward purchase to ensure a move that's seamless and hassle-free.
Once you accept our cash offer and an independent home survey is carried out, the sale is guaranteed. That means you can sleep easy, knowing there's no risk of a chain collapse or of the sale falling through.
Forget the usual property fees associated with a move. Unlike a traditional sale, there are no estate agent fees or EPC costs when you sell with Property Rescue. We'll even cover the legal fees.
From complicated legal jargon to months of delays - sell your home with Property Rescue and sidestep the usual property sale pain-points.
We promise to buy your property, whatever the condition. No need to spend money on any repairs or renovations.
Repossession is a legal process where a lender takes back a property due to the owner’s failure to keep up with mortgage payments. The lender sells the home in a bid to recover as much of the outstanding loan amount as possible.
Selling your property to Property Rescue can offer several advantages over repossession:
Property Rescue is renowned for its swift processes that can halt a looming repossession. We’ve been known to exchange paperwork in an impressively short time span. Such speed is crucial if you’re facing imminent repossession and allows you to settle your mortgage and avoid the repossession process.
You can speak to us today. Just fill in this free, no-obligation form, and one of our team will get in touch to tell you how much your home is worth and how we can help. It only takes 10 seconds to complete and can put you on your way to avoiding repossession.
We’re proud of how well we look after our customers. We are a founding member of the National Association of Property Buyers which has a strict code of practice. We are also a member of the Property Ombudsman and are governed by their code of practice, in addition we are regulated by the Financial Conduct Authority for sale and rent back business.