What is Repossession?
Repossessions and foreclosures are different things.
The definition of repossession proceedings is: litigation begun in a court of the United Kingdom by the lender or landlord for purposes of recovering possession of property that is occupied by the debtor or tenant as her or his main or sole residence.
Repossession (UK): The lender “takes back” the property, sells it, uses the proceeds to pay off the amount owed to it, and then sends the balance to the borrower. In the Building Societies Act 1997 the lender has to “take reasonable precautions to obtain the true market value of the mortgaged property”. They don’t need a Court Order, ‘though that is the norm. They need not sell the place via an auction. This is good, as they may thereby get a better price.
Foreclosure (UK): They “take back” the property, sell it, and keep the entire proceeds. This can only be done via a Court Order, and is highly ususual nowadays; usually only repossession orders are granted.
A property will be not be repossessed over one or two missed payments. You must, however, communicate with your lender ASAP. Tell them what is happening, and what you will do to make it up.
Note: “Handing back the keys” is a myth. It does nothing to stop a repossession.
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