Property Repossessions – How Are We doing?

There are many things in life that are stressful, and property repossessions has got to be one of the worst. During the last 3 or 4 years, foreclosure procedures on both sides of the Atlantic has caused countless families to lose their homes.

Whilst recent reports in the US state that repossessed homes are on the downturn, a closer look at figures would suggest otherwise. The recent figures are de facto but the speed with which properties are being processed is more the deciding factor re the numbers than an actual slow down in repossessions.

It’s no different in Europe, with vast numbers of Spanish home owners losing their homes on a daily basis. In the heart of the financial mess is Mercia, an area widely advertised a few years back as being some kind of Mecca for overseas property developers. Ordinary home owners were also targeted, with many a UK resident jumping ship and buying what they thought would be their Spanish Shangri-la.

Fast forward to the Spring of 2012 and disaster abounds. Properties are unfinished, complexes deserted. Beautifully constructed blacktop stretches for miles, then simply terminates. Manicured and lovingly tended golf courses are little more than expensive, ornamental landscaping and hotels, stores and bars remain unused.

The Spanish banks are groaning with the effort of trying to sustain a weakening economy and the rest of Europe has averted its eyes whilst praying for a financial miracle. Elsewhere, in the UK reports were published (at the end of May) that stated that house prices had fallen below those enjoyed during 2005.

In seven years, the UK householder has seen a significant drop in the value of property, and just like their American counterparts, it doesn’t look as though things are going to change anytime soon. Property repossessions continue to increase, despite the fact that UK banks have tried to create a better relationship between themselves and their borrowers.

Ireland fares no better, with house prices continuing to fall, and looking elsewhere in Europe it looks as though the entire continent is barely managing to keep a roof over its head. What does all this mean for the average home owner? Simply that you’re not alone, and that the world continues to struggle to regain the financial foothold it enjoyed prior to the 2008 crash.

What can you do to avoid going through a property repossession?

  • approach your bank/lender and discuss your future options. Banks aren’t gaining anything from foreclosures, so see what they can offer by way of support and negotiation. Ask for an extension, see if you can alter the terms of your mortgage; in short explore your options with your lender
  • if it’s possible to do so, try and sell your home. Better to off-load debt that you can’t manage, than to hang on for grim death
  • consider renting. There remains a high demand for rental property, and it may well be worth you moving out and renting your home out, whilst you (in turn) rent somewhere for yourself
  • seek financial advice elsewhere. There are a variety of charitable organizations around the country, make an appointment

Whatever you do, don’t hand your keys over and walk away, Turning your back won’t solve anything in the long term, and you may well find yourself before the court for more than just the mortgage debt itself.

Link: need realistic mortgage advice? Click here.