Complete Overview of the Mortgage Repossession Process

When the owner cannot repay the mortgage arrears as per his loan commitment, he is at a greater risk of home repossession. It means that the lender will possess the lawful right to take the possession of the property.

Learn about the steps involved during the mortgage repossession process:

Lender sends notice about the mortgage arrears - Whether the individual has bought a house, a personal flat or any other type of mortgaged home, it is mandatory to pay the loan installments timely. If the owner lags behind in making the mortgage payments, the lender sends a notice that serves as a preliminary warning. It is better to answer the notice and negotiate with the lender to settle the repossession at an early phase.

Lender applies to court asking for the possession order - The mortgage lender cannot repossess the property, until and unless he seeks the permission of the court. To get the possession order, the lender needs to make an application to the local court mentioning valid reasons for which he wants the lawful possession order.

Court announces a herring date - The court fixes a herring date and both the parties are notified to attend the lawful process. It is important for the owner to seek professional assistance to prepare for the herring and gather valid evidence to negotiate with the lender.

Judge hears the repossession case - The judge of the local court takes decision about the home repossession after hearing from both the parties. The judge can take either legal action or issue the home repossession order, issue a suspended possession order, adjourn, or dismiss the case.

Court issues the home repossession order - The repossession order is granted by the judge, when he decides that the property should be repossess lawfully. Within the order, the date of eviction is clearly mentioned and usually the time lies around 14 to 28 days. However, if the court issues the suspended possession order, the owner gets a temporary hold of the property and the order allows him to stay at the property.

Why home repossession takes place?

Repossession only occurs when the owner is not able to make the payments of the mortgage arrears timely. The lender seeks lawful action to vacate the property and take away the home. However, to stop home repossession most of the lenders opt for the process called medication. During such process both the parties are given chance to discuss the matters and solve the situation on mutually agreed terms.

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