The property market in South Africa has already started to experience great falls in house prices, many people are unfortunately being hit by this and many more stand the risk of losing their homes. Despite the tough times we are currently facing, solutions to these problems are already being offered to home owners in South Africa by companies who are able to purchase houses for cash and allow the home owner to remain in the property after the sale. This is known as a ‘Sell And Rent Back’ scheme.

‘Sell And Rent Back’ is the most utilized service which aids in preventing repossession and eviction when as a home owner you are not able to meet the mortgage repayments on a monthly basis. The great part about these schemes is that you will be allowed to stay on your home and not have to worry with being kicked out of the property out of the sale. You can simply carry on with your life as it was before and rid those sleepless nights.

Essentially this now means that the original owner (who is now renting the property back from the company), no longer will be responsible for paying rates and taxes as this is now the responsibility of the new owner. This is a great benefit as it helps in reducing the previous home owners extra outgoings which is where the problem started in the first place. The less outgoings for the home owner, the better. Another great thing that these repossession services offer is a buy-back option. This is where the repossession service gives the home the owners the option to buy the property back at a later date if their financial situation proves to be healthy enough to do so. Ideally the home owner would rent the property back from the repossession service, save money for a deposit while living in the property, and then buy the property back say 5 yrs down the line when market conditions have improved, as well as the home owners financial situation being in a better state.

In order to sign up to a deal like this, the home owner simply needs to source one of these companies that has the ability to buy houses for cash. These repossession services don’t normally charge anything for their service so its great for the home owner as they don’t need any upfront cash in order to enter into an agreement like this. The home owner will also be under no obligation what so ever which takes the pressure off the home owner completely. These companies are able to prevent repossession days and even hours before the actual repossession of the property. They really do provide a valuable and life changing service which is well worth looking into.



Passive Income

I would like to get on the housing ladder, and I think this may be a good time to get repossed property. The question is, where do these properties get sold? If they go to estate agents I can see them all being taken by property developers.

Quick House Sale

Once a possession order has been issued for your home you may think there is no way of stopping the repossession process. This is not true. There are several ways you can stop your home from being repossessed and a few things you can do to help ensure you have the best chance of accomplishing this formidable task.

Take Care of Your Property

One of the most important things you can do to help stop your home from being repossessed is to take good care of your property. This is particularly relevant if you are trying to sell your home quickly.

One of the worst things you can do if you are trying to stop repossession is to destroy the interior of the house. Many people strip their house clean of valuable items in order to ensure that the lender receives as little of their personal belongings as necessary if the possession goes ahead.

While this may prove cathartic, it will not stop the repossession of your home. In fact, it can have the opposite effect as a property devoid of heating, carpets, kitchen appliances etc will be worth less when it is being sold.

Considering the proceeds of the sale may be used to pay off the accumulated arrears and remaining balance of your mortgage, you should do all you can to ensure that the lender achieves the highest price possible when they sell your property.

Be Honest with the Lender

Another important thing to do when trying to stop repossession of your home is to be honest with the lender. If you are completely broke then you should tell them so.

It will cost the lender time and money to pursue you for your outstanding debts so they may not be inclined to continue chasing you if you make them aware that there is nothing to chase.

This does not mean that you will be released from the debts you owe, but it can help to relieve the pressure of constantly being hounded for payments that you cannot afford to make. By being honest about your situation you can buy yourself the precious time needed to concentrate on finding a permanent solution to stopping your home from being repossessed.

Check Your Credit File

Another important step in the process required to successfully stop repossession of your home is to check your credit file. Lenders will use this file as a tool to help determine whether you have the means to pay them back the money they are owed.

It is important to check your credit file regularly regardless of whether or not you are facing repossession. By doing this you can discover whether there have been any unauthorised checks on your file from credit issuing companies.

If you have received a shortfall letter from a lender you should check your credit file to discover whether they have performed an unauthorised search. Legal issues may arise from such an act that could benefit you. It is, of course, necessary to consult with a repossession solicitor to determine whether this has any bearing in your particular case. Every individual in the UK has a right to privacy and it is possible that an unauthorised credit search may breach this right.

Sell or Remortgage

The above points are intended to provide some useful information that can help stop the repossession process if used in combination with more powerful techniques such as refinancing your debts or selling your home quickly.

These are probably the two most reliable methods for stopping home repossession. There are various companies who specialise in these techniques who offer their services throughout the country. If you are facing home repossession you should contact several of these businesses to help you decide which technique you would prefer to use.

Whichever method you choose, remember to keep your property in good repair, be open and honest with your lender, check your credit file, and take action as soon as possible.



Quick Property Sale

While speaking to people at various events or network opportunities, every so often some one mentions about the increasing number of repossession, thanks to interest rates that have been creeping up slowly in the past year or so.

Recently some one mentioned, “do not why people let themselves into trouble”, he said,”I would just hand over the keys to the bank manager and save my credit history rather than going through repossession hell.”

Nice idea, only that this does not work in UK.

Many people I have spoken to often speak about the foreclosures and ‘how to buy these properties and also help people in trouble.’Unfortunately these people have been regarding far too many property books published for American audience. Foreclosure is a term used in the US. Law works differently in UK, and it refers to repossessions.

Same thing? Hardly!

Lets us talk about foreclosures versus repossessions first.

Myth 1: Foreclosures versus Repossessions

US housing lenders are allowed to apply to the court (and granted permission) to seize the house back, sell it and keep the whole proceeds. Normally court allows repossession but increasingly they are allowing foreclosures. This means that investors can buy the house from the company cheap and make a profit on by reselling it at full market price.

However in UK, companies are not allowed to seize the house. Courts allow them only to repossess the house to be sold at the fair market value, pay the owed amount (and expenses) from the proceeds and send the balance to the borrower.

The Building Societies Act 1997 directs companies to “take reasonable precautions to obtain the true market value of the mortgaged property.”

The true value of any property is often subjective – and depends on the opinion of a purchaser. So how can a mortgage company determine its true market value?

Auction is a route that many companies take.

However the mortgage company does not has to sell the property via auction to obtain the true market value. Courts generally accept this method as a determinant of fair value, but as long as a company can demonstrate, if questioned, that other methods were used, it is allowed.

Some companies sell the property via local estate agents without disclosing that he property is repossessed. By the way of like for like comparison, they can demonstrate that fair value was achieved.

Myth 2: Hand Over The Keys Myth

Many people believe that if they are struggling to keep up with paying the mortgage then handing over the keys to their bank manager will clear them of any further obligations of making payments – because they do not own the house, right?

Sadly this is far from the truth.

Mortgage company lends you the money (cash) and requires you to pay back the whole amount and interest in cash. If the company has to sell the house on your behalf then you are still liable for any interests incurred till all the dues are cleared.

Myth 3: Property repossession allows you to make a fresh start.

Only as long as all debts are cleared from the proceeds of your property!

If the proceeds from your property only pay back a part of the loan to your mortgage company then you are still liable to pay back the outstanding amount. These situations can happen if the property prices have crashed below the borrowing levels.

So if you are facing repossession threat then it is best to speak to some one competent about your situation. One advice is: do not ignore correspondence from your mortgage company. Second, get neutral advice as soon as you can. You do not always have to pay for the advice. Many free advice resources are listed on this link.

Remember,if property is sold via your lender (after repossession) then you not only become liable for further charges (e.g. bailiff etc), this also gets recorded against your credit score for future reference.

Many people prefer to sell the property to an investor who can buy the property fast. These investors can be located via doing a search on Internet, searching your local papers or speaking to those in the know.



Rent Back

Original article

After the last article on Costa del Sol bank repossessions I received an enquiry about how bank repossessions work in Spain compared to the UK as he was having trouble with his repayments. So please find below the stages that you expect should you (god forbid) have to deal with in the case of non-payments.

Arrears

The first stage would be arrears, where the borrower is unable to meet payments. The mortgage provider will be in contact asking for an explanation and start charging you a variety of penalties. The lender may also attempt to renegotiate the existing agreement.

IMPORTANT NOTE: If the borrower is are having difficulty meeting repayments, contact you mortgage lender prior to arrears as they may be willing to discuss renegotiating you agreement, off-setting payments, etc… as it is not in the banks interest to repossess your property.

90 days later

90 days after the first arrear, the debt collection department will attempt to recover the defaulted debt.

Up to 30 days after default

The borrower will receive a certified document from the lender informing you of repossession proceedings through the courts.

Further 10 days later

Legal action will be started against the borrower for outstanding repayments and to auction the property to the public to reclaim all monies owed.

Up to 16 months later after legal action

The property is put on auction to be bid upon. If there is no purchaser, the property becomes the possession of the lender for 50% of the properties value.

If lender becomes the new owner, there may be additional monies owed to the lender as in most cases the mortgage will be higher than 50% of the value of the property. Plus the additional penalties for arrears, court costs, etc… there may also be an attempt to reclaim owed monies from any guarantor on the mortgage as well.

The land registry information is then updated to confirm the new owner.

6 months later.

Eviction notice. Court officers along with police and a locksmith will evict the borrower. Although if it is the borrower’s main residence and they have children, it is far next to impossible to have the borrower evicted. The debt would remain though.

Hope this gives you a better idea of how bank repossessions work in Spain. Please note I have kept the date relatively general as they are not clear cut

Regards

Andrew Belles

Costa del Sol property



Real Estate Professionals

The owner of the property I am about to re-possess has a loan to a building society/not a mortgage/as a first entry for colateral. the Court has decreed that I take possession in order to be repaid my loan? what are my rights please?

Sell House Quick

If you find yourself in the position were your flat may be repossessed and are looking ways that you may be able to avoid being evicted from the property that you own then a “Sell & Rent Back Scheme” might be for you.

The fundamental principle behind the Sell & Rent Back Scheme is that the current owner of the property is able to sell his or her house quickly to avoid being evicted and have the property repossessed while at the same time not having to leave the property and be able to rent it back as a tenant, quite often it is not unusual for these schemes to include the ability to buy back the property at a later stage if your financial situation has improved.

By using this method it does see that all your debts are cleared not only the outstanding balance of the mortgage but any secured debts and mortgage arrears will be paid in full as opposed to the alternative of the property being auction any thing outstanding will be chased by the lender until it is paid back in full also of course if the property went to auction would be removed from your house and would have to find alternative accommodation.

For this reason this solution is increasing in popularity in the UK and is supplying an alternative to that of eviction amongst the UK’s growing credit crisis also referred to as “the credit crunch”

Even if you find your self in the situation were eviction is just days away by engaging in one of these schemes you will find your lenders more than willing to cooperate as they would much rather prefer this alternative were they get paid back in full than the expensive and lengthy process of eviction, repossessed, auctioning and the chasing of the remaining debt.

go now to http://www.avoidhomerepossession.co.uk/



Quick Property Sale

I dont believe that the estate agents are putting forward our offers to thew bank and seem to be mucking us around.
We would like to go straight to the bank with our offer!!

Rent Back Fast

One of the most unpleasant consequences of failing to pay your mortgage is “repossession” of your property. This is a problem that is affecting an increasing number of homeowners throughout the country.

The first notification will be from the lender warning of the consequences should you not keep up your payments on the mortgage. If your mortgage payments are not being kept up to date then the lender may decide to approach the courts to apply for a repossession order.

The threat of repossession is something that a growing number of individuals are facing today. This can be put down to a number of factors that will on the most part, include borrowers who overstretch themselves financially and subsequently struggle to meet their monthly secured commitments.

Runaway property prices have too played a part as this has made homes in many areas unaffordable for first-time buyers. Many stretch their finances to get a first foot on the ladder. Some will see this as an essential means for home ownership.

Debt campaigners have highlighted in recent months that a growing number of borrowers were unable to meet their mortgage repayments, with many of them first-time buyers who only recently climbed onto the property ladder.

The Citizens Advice Bureau said that nearly a million people had missed one or more mortgage repayment in the past year. Over two million said they were concerned that their finances may not stretch to cover their monthly debts.

Missing payments on the mortgage or secured loan is a serious issue which could lead to arrears and possibly repossession if matters are not dealt with.

The repossession process will start by the lender applying to the courts for a repossession order. It is unlikely that the courts will grant this on the first hearing. They will probably grant a suspended repossession order.

This suspended repossession order means that that the individual involved must abide by the courts ruling. This will include having an agreed a payment in place with the lender to reduce the arrears balance over a period of time.

If these payments are not being met, the lender can apply for the repossession court order. In this case the courts are more likely to take the side of the lender & grant the repossession court order.

If the repossession order is granted, the lender will attempt to sell your property quickly to recover their money. They typically use auctions and estate agents to sell your property, often discounted to attract quick buyers. When the property is sold, the lender’s account is cleared first.

Any surplus will be repaid to the homeowner. However, if there is any shortfall, the lender will attempt to recover it from the individual involved for a period of up to 12 years!

The important points to remember is that without taking action, these problems do not just go away. At the earliest possible stage the lender must be informed of any financial issues that may affect the monthly payments of the mortgage. Do not ignore letters, especially court papers and court hearings.

If this does happen to you, then you must contact the lender immediately and explain your situation to them. It may be possible that you able to come to an arrangement to ease the situation.

If you are having serious problems then another option to consider is remortgaging. If you have enough equity in your property then you might be able to switch lenders and start afresh.

So whatever stage of the repossession process you are, you do have options that you can explore. Just make sure you act quickly and keep your lender informed.



Quick Property Sale

Statistically, the figures for home repossession have risen by 45%, according to Government figures. There can be many reasons that lead to house repossession, such as: divorce, credit card debt, illness, secured or unsecured debts or separation.

The process of repossession can legally begin when 2 payments to a lender have been missed. The first missed payment brings the borrower into arrears with the lender, who then have to be contacted and a payment schedule agreed. If the borrower does not contact them, or cannot afford to make the payments and a second payment is missed, then the lender can begin the process of home repossession.

The first stage of this is for the lender to state in a letter that the borrower has seven days in which to meet the payments or to agree a payment scheme. If this is not possible, then solicitors will begin court proceedings, seeking a home repossession order.

Usually the court will try and see house repossession as the last eventuality. However, if the borrower is deemed to be unable to make the necessary repayments, including arrears and penalties, then he will be served with an eviction notice and a date will be scheduled to leave the house.

The repossessed home is now the legal property of the mortgage lender. The lender can then instruct an estate agent to put the house on the property market or for it to be sold at auction.

First-time house-buyers can research these properties and they can become an affordable alternative in an increasingly expensive market.

Offers can be made on a repossessed house, but the lender may decide they want to publish a ‘notice of offer’ in the local press. This states that the lender will accept higher offers that are received by a certain date.

Auctions used to be mainly used by investors looking to by the property and sell it on at a profit, but now those wanting to get onto the ‘property ladder’ – but may not have the necessary funds for a standard purchase – can do so, as the properties are usually sold for less than their market value.

Other benefits include the bidding process, which is in an open forum so all bidders know the price and do not have to bid ‘over the odds’ to secure the sale. Also, the process is much quicker than the conventional sale process, usually taking 1 month from sale to occupation.

There are other factors involved, however. A repossessed home may be in need of repair and renovation or carry a negative credit rating associated with the address – although this can be absolved by contacting the relevant credit reference agencies.

There are lists of auctioneers available in local directories, but it is also worth contacting estate agents and mortgage lenders who have a vested interest in the sale of any repossessed property, although mortgage lenders can be secretive about their involvement in house repossession, in terms of image-consciousness.

The Internet offers many services that can supply lists of repossessed properties, but these are likely to generate a lot of interest, due to the potential to buy a house at less than market value.



Sell and Rent Back