Safety Net

Posted in Safety Equipment by admin on March 9, 2010

Safety Net

Homeowners Need An Extended Safety Net To Avoid Repossession

As unemployment continues to rise it is hoped that the Government will give homeowners an extension to the current safety net that is in place. This may help them to keep their homes if they are having trouble meeting their mortgage repayments.

The CHI, Chartered Institute of Housing along with the Building Societies Association has declared through the UK Housing Review for 2009/2010, the importance of the mortgage interest scheme to homeowners facing financial distress. They are asking for the scheme, which provides homeowners with a safety net if they become unemployed, to be extended for the long-term. Since the scheme was set up by the Government, homeowners have benefited from the temporary measures and repossessions have been avoided. The scheme has provided a safety net and it has helped those who have been made unemployed and who could not maintain their mortgage repayments.

The amount of time homeowners had to wait after suffering unemployment has been reduced from nine months, which was a huge relief to many homeowners. The support for mortgage interest scheme allows the unemployed homeowner to apply to the Government and receive help with the interest part of their mortgage repayment. While this has helped many, 2010 is still very uncertain which has left many holding their breath and praying they will not become a statistic of redundancy. Predictions are that should the rate of interest rise steadily in 2010 and continue to do so, those homeowners who have re-mortgaged, or first time buyers who took out a mortgage in the last four years or so, are at risk of being unable to keep up with their mortgage repayments and so may be faced with repossession.

One thing is clear from research that the sooner homeowners contact their mortgage provider or seek independent advice about their mortgage arrears, the better the chances of them remaining in their home. Research showed that around 97% of homeowners in mortgage arrears during the past 2 years managed to stay on in their property after seeking help and advice immediately.

Of course, depending on your circumstances you may not be able to reach an agreement with your mortgage lender. In this case, if repossession is imminent you need to look into other solutions to avoid the mortgage lender evicting you. In this case, you may wish to sell your home on the market, if this is possible in the current climate, or consider selling the property to a company offering a sell and rent back solution. This may be ideal if you wish to remain in the property as the tenant by paying rent each month with the option of being able to buy back the property in the future.

Anyone wishing to look into this option should ensure they choose an ethical sell and rent back company who are backed by the Financial Services Authority. Of course, they should also look into the scheme very carefully and weigh up all the facts before going ahead. One of the benefits to selling this way if you cannot meet your mortgage repayment and the arrears is that the company can show you how to stop repossession proceedings to give time for the sale to be completed. If you believe that your situation is only temporary then of course another advantage is that you are able to buy the property back in the future.

About the Author

Oliver Darraugh is one of many real estate specialist
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