Repossession

If you have mortgage arrears, it is likely that no action will be taken until 3 monthly payments have been missed. You will not necessarily lose your home, even if your lender has started possession procedures. The process can easily be stopped right up until the last minute. Send a letter with a copy of your financial statement to your lender, and if applicable, the court including the case number at the top. Make sure everyone knows you have taken the first steps to resolve the problem.

If you have a tremendous amount of arrears to pay, you may be tempted to hand over your house keys to your lender, walk away, thinking all your troubles will now be over. However, it's not quite as simple as that. The lender will take possession of the house and sell it, probably at a lower price than you could get yourself, adding on a whole array of extra charges for doing that. They will then go on pursuing you for any difference between the outstanding debt (including the extra charges) and the proceeds of the sale of the house. This means that you will be worse off than if you had stayed in the house until the lender went to court asking for repossession, and you'll be without a roof over your head in the meantime.