Repossession. A horrible thought, and an unlikely scenario. If you happen to be on the cusp of your lender taking possession of your house because you haven’t paid, or can’t pay your mortgage, it is not the end of the world, as much as it might look like it. There are other options out there for you. Let’s take a look at what you can do.
PPI could help you
If you’re unable to meet the full payments for your mortgage, then you could look into Mortgage Payment Protection Insurance (PPI). This will help you meet repayments for a couple of years and help you back into positive bank balances. On paper this isn’t a bad option, it was designed for mortgages and credit card owners to be protected if unemployment or accidents force them out of income. Beware who you’re being sold from, as this kind of protection is regularly mis-sold. Look at certified estate agents with years of industry experience to inform you of your best choice with PPI. Claim this before registering for government help, as that will only cover the interest on your debt.
Support for Mortgage Interest
This is a government scheme that makes interest payments on the first £200,000 of your outstanding mortgage. To be eligible, you have to be receiving income support, like Jobseeker’s Allowance or pension credit. It also takes a long time to get to you, beginning at 39 weeks after the mortgage holders claim the initial benefit. It’s not as immediate or thorough as PPI, but can help if you’re really in a bind.
Speak to your Lender
If no government assistance is available, then it is worthwhile talking to your bank. Generally, banks don’t want to see your property repossessed and would rather find a way to have you retain your mortgage. Having you – or a leading property agent – talking to your bank could help you change your mortgage to interest-only, take a break from repayments or even extend the mortgage. Even small payments back to your bank will show you’re a reliable borrower, and can help build trust with your lender. Remember: you should never miss a payment without talking to your mortgage lender first – it’ll automatically alarm them to their ‘arrears protocol’ if you keep quiet.
Know the rules behind repossession
Repossession is a legal process and should be treated as such – so don’t assume the bank is always in the right, you still have rights in the process. Your lender must follow certain “pre action” rules and give your fair warning and an option to discuss paying off the arrears. Other details they should hand over includes details of previous payments, how much is left on your mortgage, the amount of arrears, and more.
Get independent advice
One of the best ways of tackling a potential repossession is to never face it alone. Not only should you be in constant communication with your lender, but you need to seek independent advice from experts who know the rules, and the industry. iSell’s team of experts are on-hand to assist you with any property needs you have – call us today to see how we can help.