Many people opt for mortgages to become the owner of a property. According to this legal agreement, the property itself is offered as security and if you fail to pay the mortgage, your property may be repossessed. As such, it is important to know the risks of this kind of agreement as well as solutions if ever you start having difficulties paying your mortgage.
Clearing debts and finding another accommodation
If you have debts that you cannot pay back, lenders have the right to recover their money by registering that debt as judgment mortgage against your property even if you have no mortgage on the property itself. If you do not agree to it, the next step will be in court. Meanwhile, you will have to find another accommodation. You may seek the help of local authorities as well as associations offering social housing. If you are renting from a private landlord, you may apply for a Rent Supplement or a Housing Assistance Payment.
Legal issues
As the law regarding repossession was amended on 1 December 2009, the legal implications differ for those who opted for mortgages before that date and for those who opted for mortgages after that date.
Sale of your property
You may agree to the repossession of your property if you cannot pay your mortgage. You may find some agreement with the lender for the sale. If you fail to give your consent in writing within 7 days before repossession or sale, the lending institution will seek a court order to proceed with the repossession or sale. This is known as a mortgage suit.
Disagreement
If you fail to meet a repayment plan for your mortgage but do not agree to have your home repossessed, you will have to engage in legal proceedings. Usually, courts do allow you some time to make arrangements for reimbursement before giving any final decision.
Legal procedures
Legal procedures in case of repossessions are tedious. It is recommended that you prepare yourself according to the Circuit Court Rules 2009. Legal steps, such as “entering an appearance” or a “prima facie defence”, have to be thoroughly followed. Otherwise, the County Registrar may file an order for possession. The lender may also apply to the High Court for a possession order. Other legal procedures include the enforcement of the judgment order, the fi fa order, and the judgment mortgage.
Seeking help
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Article published in How to avoid repossession
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