The process associated with repossession or purchasing of repossessed properties are very appealing matters but dealt differently. Repossession is very stressful, but for those who would like to buy repossessed properties can benefit from a variety of different ways. Understandably, individuals in both situations have many questions, and this article covers some of the most common answers in both areas.
Is it safe to buy repossessed properties?
Yes, it is safe to buy a repossessed property and have several benefits, including the fact that the amount owed to the bank is less than the property's market value. You also don’t have to pay transfer duty because the bank is a VAT vendor. However, the risks are that once your offer is accepted, the lender may still keep the property in the market. This enhances the chances of been gazumped as another potential buyer may put a higher offer. This can even take place once you have paid all the legal and surveys cost.
How can I find out if the house has been repossessed?
There are many different ways you can do that, such as by using the property's address to search the county records or purchasing a list of pre-foreclosure properties in your neighbourhood for a modest fee. You can also inspect the records In-person and read the Newspapers to find out more.
Foreclosure is defined differently in different countries. In the UK, it is a process that allows a lender to recover the amount owed on a defaulted loan by selling or taking ownership of the property and are relatively rare. In foreclosure, the lender approaches the courts to take ownership of the property in question, which is then sold. Foreclosure requires a court order and the UK's courts very rarely grant foreclosure requests, favoring repossessions instead.
How to buy a repossessed property, and how long does it take?
You can buy a repossessed property through an agent or in an auction. Auction is the most common ways of selling repossessed properties as these properties need to be sold relatively quickly. Once the property is purchased from the auction, you are in a contract and cannot backup. You must also complete the transaction within 28 days, which can be a hazardous process. To buy a reposed house, you need to investigate the property, get a good mortgage deal, check tenants’ records, post, credit rating and that the utilities are switched off. You must be prepared that the agent is not obliged to take the property off the market and you may also have to replace missing fixtures and fittings.
What happens when you buy a repossessed property?
It is one of the most interesting questions asked and includes essential steps. Clearance of previous owner's arrears is given priority and therefore sales proceeds while making sure it takes place as quickly as possible. If the sale price exceeds the debt, the erstwhile owner will receive the balance. The balance extracts any charging orders or other interests on the property.
Going through repossession:
How can I stop my house being repossessed UK?
You can negotiate an affordable repayment plan with your lender, speak to a debt adviser, take a payment holiday or possibly sell your house. Your lender has to prove that you have paid sufficient payments for arrears. In that case, there is not any place for mistakes. If your lender's records are not correct, you can speak to your lender or challenge their decision if they decided to proceed with repossession. To stop repossession, you will have to higher a solicitor and attend the court hearing where judgement will be issued within 28 days known as the verdict, or you may get suspended possession order. The order should include the money order” specifying what amount you should pay, including an assessment of money judgment for the cost highlighted in the following section.
What happens if your house is repossessed in the UK?
Once the property is repossessed to recover the mortgage debts, which generally is after 90-180 days of mortgage debt, the lender may decide to sell the property at the auction which occurs legal, real estate professional’s or estate agents’ fees. If the property is not sold after repossession, you are still liable for the mortgage payments until the selling process is completed.
In addition to the above mentioned, there are additional costs that can added to your outstanding balance, including interest, penalties, upkeep, repairs and remainder. It gets worst in the event of voluntary repossession where you leave your house and give the keys back to the lender. In situations like this, you are liable to make monthly mortgage payments, repayments of the arrear and other costs such as building insurance. You may also have to pay fees to your lender to resell the property. Your credit history is also likely to be poorly affected, which can make it very difficult for you to secure future loans or mortgage.
Can I get a mortgage if I've had a house repossessed?
Yes, you can. You need to know where to look and meet the lender’s criteria. The criteria can be different depends on the lender’s requirements, their application process and rates, the amount of deposit you can are willing to pay and credit conduct. Some other factors include when your house was repossessed as if the date is more recent it is more difficult to obtain a mortgage, size of repossession which counts towards several properties being repossessed and the amount in arrears - it makes it easier if the reason of repossession if it is a legitimate and backed up with the right evidence and if there are any legacy payments left.
Having mentioned the above points, you should not attempt to get a mortgage by yourself if you have gone through repossession in the past. An expert can help you to avoid any mistakes and understand forthcoming pits and falls. For more details on both areas covered in this piece, please see the article section of this website.