You are not alone
More and more Aussies are finding mortgage stress affecting their family
Repossessions are starting to become common. Last year 17,000 homes were repossessed, the highest number for five years, with further rises predicted for the coming year by the Council of Mortgage Lenders.
A rise in repossessions means that bailiffs will be kept busy – so what can you do to stop the bailiffs coming to your house uninvited? This will depend on how bad your situation is, but even if you have been handed a court order, and proceedings for repossession of your home have been started, there are still ways that you can deal with the situation.
If you are, or someone you know is facing repossessions, this article will help to enlighten you with the options that you have.
Falling behind on your payments?
Lenders will normally only start to take action if you miss payments for two months – if you are having difficulties, the best thing to do is let your lender know and see if you can come to an arrange- ment with them.
If you fail to come to an arrangement with your mortgage lender, they are most likely to send you a letter from their solicitor demanding payment, before issuing repossession proceedings with the county court.
By attending the proceedings, you may be able to come to some arrangement with the court and your lender. However, if you do not attend, the court will have no alternative but to order repossession.
If you can make an offer to keep paying your monthly installments, plus something towards the arrears, the judge may be satisfied with this, and grant a Suspended Order For Possession.
Eviction Notice and Sheriff’s Visit
If you have made no acceptable offer for repayment, or defaulted on a Suspended Possession Order, then your lender has the right to seek foreclosure of your property. In this situation, a court order will be granted, and a date will be set for a Sheriff to visit your property to formally take possession. You will normally be given just 10 minutes to pack your things and get out. At any point in the process, before the bailiffs arrive, you still have a number of options to solve the problem.
• Negotiate repayment – If you can afford to pay make your normal monthly mortgage installments and pay something towards the arrears, the lender may be able to agree to this.
• Pay off all of the arrears – Your options here are to borrow money from friends or family, or from another lender. It is important to be careful here though, if you can’t afford the payments on a new loan, you may have more lenders chasing you for money.
• Remortgage – Some mortgage companies may be willing to remortgage if your house is worth more then your outstanding debts.
• Sell your property – You could do this through an estate agent, which would probably get you the best price for your house, though there are downsides – it could take many months to find a buyer and complete a sale, and you may even need to spend money on your house to attract buyers, also bear in mind many buyers pull out due to broken chains.
• Sell your property fast – A fast cash buyer will normally offer you between 80% and 85% of the market value of your property, but they will give you a fast sale, completing the exchange of contracts in a very short time frame. If you are facing a foreclosure order, this could be the answer. In addition you can sell and rent back your property, avoiding the hassle and stress of finding somewhere else to live.