Stopping a repossession order
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Approaching repossession with a positive mind set
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First and foremost it is important to avoid panic and maintain a positive outlook if you want to prevent the loss of your home and stop eviction. Whilst you must act quickly, before taking action bear in mind that your lender will not start the repossession process immediately and that court proceedings can last for weeks, giving you time to find a solution and potentially stop repossession of your home.
Before starting court action, your lender will try to reach an agreement that works for both sides. Hopefully by this time you have written to your mortgage lender to try and facilitate this process. Nevertheless, your lender is legally obliged to follow a procedure before starting court action and give you at least 15 days written warning or repossession notice.
As a result, whilst it can be a natural reaction when being threatened with repossession, do not panic as there are still ways for you to avoid house repossession.
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Responding to your lenders repossession court action with a N244 defence form
If your lender has issued court action you will have received from the court your lenders claim form (setting out your court hearing date), particulars of claim (setting out the reasons your lender wishes to repossess your home) and a defence form (for you to complete and return to the court).
Follow the instructions set out on the courts guidance notes and complete the N244 defence form. The form is two pages long but you are able to attach additional documents and pages as you require, so you are not limited purely to the spaces and textboxes on the form. Remember to send your documents back to court either via recorded postal delivery, to guarantee that the court receives it, or take them directly to the court and hand them in yourself. The N244 form has specific sections for you to complete:
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Your details and details of the claim issued against you, such as the claim number and your lenders name (‘the claimant’)
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The order you are asking the court to make and why: here you are asking the court to stop the repossession action by your lender because it is still your intention to meet your mortgage payments as they fall due and settle your outstanding mortgage arrears. The judge will either be looking for proof that you can pay all of your arrears through your income or other sale of other assets, or that you will be selling your property, in which case you are applying for an ‘Order for Sale’.
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Your witness statement: this is a personal statement from you, written in paragraphs, explaining your situation and your intentions to make payments to your lender. Whilst it might seem daunting having to write another lengthy document, this should be relatively straightforward as you should take and summarise what you have already written to your lender in correspondence, and set out the sequence of events in chronological order that have got you to this stage. Writing style is important here, you are trying to explain a series of events and your situation to a judge that will be unfamiliar with the background, so keep your language simple and professional, and emotions against your lender out of your statement as best as possible. Be positive, this is an opportunity for you to give your side of the story. As part of your statement make sure you explain your income and your expenses, why you got into mortgage arrears, the steps you have taken to improve your financial situation, and the plan you have for making mortgage payments and settling your mortgage debt. Our practical advice pages can help you with this.
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Evidence relevant to the claim: append all and any relevant documents that you reference in your witness statement here. This includes your mortgage statements, copies of all of your correspondence with your lender, details of your financial situation (such as your financial self-assessment and money saving actions) and your plan to settle your mortgage arrears.
It is important to reiterate here, do not give up on stopping repossession if the case goes to court. Even if your case goes to court, it does not necessarily mean your house will be repossessed. Even if your lender has taken legal action against you, you can still reach an agreement and stop your house being repossessed. If no agreement can be reached at this stage, your lender still needs court permission to repossess your home. Do not give up therefore, and instead be sure to turn up at court and prepare to defend your claim.
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Get expert advice on how to avoid repossession
Expert advice is expensive and if you have been threatened with repossession, you may not have money to spend on financial advisors or solicitors. However, contacting an expert or simply getting their advice can help prevent repossession. Furthermore, you could be eligible for free legal advice or help with legal costs. You can check if you are eligible for legal aid here.
It is worthwhile remembering that you can get free advice on the repossession process, including how to avoid repossession, how to manage your finances and where to turn for help from your local council and organisations in addition to us, such as Shelter England, National Debtline and Citizens Advice. Please refer to our useful links section for further details of free-to-use advice available to you.
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Consider selling your home
If the judge makes an order for repossession and sale of your home when your case is heard in court, you will have to vacate your home to allow your lender to sell it. As set out in the repossession process guide, if you refuse to leave you will be evicted by bailiffs and if there is a shortfall once your lender has sold your home, you will likely have to declare bankruptcy.
In this scenario you lose in a number of ways because your lender will typically sell your home at a substantial discount to its market value via auctioneers. You will be liable for the auctioneer’s fees, estate agent fees incurred in advertising the auction, and all legal and other costs associated with the sale. This therefore increases the probability of your home being sold at a price that is not enough to cover your mortgage debt, leading to shortfall debt.
To make matters worse, you are still the legal owner of your home despite having been evicted and not living in it, therefore you will still be liable for other ongoing obligations such as insurance, council tax, repairs, maintenance, and water, gas and electricity bills. A combination of these factors means you could be significantly worse off than if you had been allowed to stay in control and to sell your house on your terms before your lender takes repossession.
If your financial situation is not expected to improve, selling your home may be the only way to avoid repossession. It will allow you to get a higher price for it compared to your lender selling it at an auction, and you can move out on your terms, depending on who you sell it through and sell it to.
You could try to sell your home through an estate agent. However, if you are against the clock this may be unsuccessful in avoiding repossession as the average time to sell in the UK can be 6 months or more. Alternatively, we could purchase your home from you without any of the costs you would otherwise pay in a sale process, such as estate agents fees and legal costs, as we will pay those on your behalf. The sale can be completed as quickly or slowly as would like, enabling your arrears and mortgage to be paid off and repossession stopped. Furthermore, you decide when you move as we always work to a timeframe that suits you. To make your move easier, we are happy for you to stay in your house for an agreed period after the sale has completed to help you focus on your next move and plan ahead. No fees, increased certainty, flexible timescales, peace of mind and a safer, speedier sale are a few of the benefits of selling your home to us to avoid repossession.
Please do not hesitate to contact us if you are currently trying to avoid having your home repossessed and feel we can help you. We offer fee-free advice if you are facing mortgage difficulties, a no obligation purchase offer for your home, and can talk to your mortgage lender to stop repossession and inform them of a sale proceeding. Our FAQs also set out the most common questions relating to how we help.
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Comparison of selling your home privately vs. publicly via an estate agent
To help you decide whether you would benefit more from a sale through an estate agent to members of the public or privately to us, set out below are the key differences under both scenarios.
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Financial comparison of sale options
By having us buy your home, you can proceed at your desired speed and one that suits your mortgage lender, and you save money at the same time. In order to conduct a sale tailored to your requests and needs we typically offer 85% of market value. However, taking the slower nature of the property market into consideration and the associated fees, you can actually get more for your money, faster, safer and with increased peace of mind.
If you feel you might benefit from a private sale, would like an offer to consider or there is anything else you feel we can help you with, please do not hesitate to get in touch.
