Monday, 3 August 2009

10 tips to avoid house repossession

posted by debts.org at 23:51

1. Mortgage arrears and serious debt problems

Millions of people in the UK are facing serious debt problems, mortgage arrears and even home repossession. If you ignore the bank statements and the letters from mortgage lenders, your debt problems will get worse. You will find a debt solution if you make the effort to contact a debt advice company. You can get out of debt at little or no cost in the UK today, and there are several options available to you if you are suffering minor or serious debt problems.

2. Check all mortgage paperwork

Take the time to sit down and go through every bit of paperwork you have relating to your mortgage. Read the small print so that you thoroughly understand the terms and conditions and check when you will be in danger of house repossession if your mortgage is in arrears.

3. Address your mortgage arrears

Once you understand the seriousness of your mortgage arrears, you can take steps to get debt advice or debt help in the UK. Don´t bury your head in the sand but make sure you understand the extent of your mortgage debt problem before contacting a debt advice company who will help you and give you free guidance.

4. Monthly mortgage payment debt

Find out how much you are expected to pay monthly, when this is likely to change, whether it has gone up recently and whether it is likely to go up when your mortgage is next reviewed.

5. Be honest with yourself

Be honest with yourself and with your lender to avoid more mortgage arrears and debt problems. Can you continue paying your current monthly payment? Can you afford it over the next few months, and more importantly, if your mortgage increases again, can you manage the payments?

6. Show commitment and willing to your mortgage lender

Check how many payments you have missed. If your mortgage arrears are the result of unemployment, redundancy or a short-term debt problem which may be resolved in a couple of months, contact your mortgage lender and explain this. If you have mortgage arrears and debt problems which are likely to change for the better, offer to pay your missed payments back over
6 months. Take the bull by the horns and contact your lender before he starts to add interest and costs to any mortgage arrears. Any arrangement you make to clear your mortgage debt, you must stick to – so make sure it is achievable before offering to pay off the amount you owe.

7. Mortgage is a priority payment

Understand that paying your mortgage is a priority payment. A mortgage loan is secured against your home, which means if you fail to keep up the mortgage repayments, you could face house repossession. If you are also struggling with credit card debts, store card debts or bank loan debts, pay your mortgage before paying unsecured debts.

8. Work out your total debts and take advice

Work out how much your total debts amount to. Include everything in your calculations including charges, late payment fees, court costs. Pay the arrears back as soon as you possibly can. Consider selling household goods, cashing in an insurance policy, selling a car or caravan, or even taking a part-time job in the evenings to clear your mortgage debt.

9. Going to court for mortgage debts

If your lender is taking you to court, write down your side of the case, to present to the judge on the day of the court case. Put down concrete proposals which are manageable and outline how much you can pay back each month to clear your mortgage arrears. Put your case across clearly to the judge, and there is every chance that your house will not be repossessed.

10. Repayment mortgage debts

If you are struggling to pay back a repayment mortgage, where you will pay back the amount you borrowed plus interest, ask your lender if he can arrange an interest free mortgage for 6 months, which should give you some breathing space. This will make your payments less for that amount of time. Lenders will treat you much more sympathetically if you make a sensible suggestion for repayment, before they start to threaten you with court action or house repossession.

Debts.org helps people to get out of debt, and gives free debt advice, arranges Individual Voluntary Arrangements (IVAs), Debt Management Plans (DMPs) and can even reclaim unfair bank charges or mis-sold payment protection insurance in Liverpool, Luton, Newcastle, Stoke, Colchester, Oldham, Burnley, Manchester, St.Helens, Crawley, Blackburn, Sutton Coldfield, Eastbourne, Portsmouth, Northampton, Brighton, Stockport, Poole, Oxford, Middlesbrough, Bolton, Ipswich, York, Telford, Rotherham, Dewsbury, Huddersfield, Sheffield, Bristol, Hull, Nottingham and every other town and city in the UK. Call our free debts advice helpline on 0844 277 7999 or fill in the online form.

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Top ten list for first time home buyers

posted by debts.org at 23:44

If you are a first time home buyer, make sure you get the right advice and help with your mortgage arrangements. There are so many mortgage deals available nowadays, that you need to shop around and make sure the mortgage you choose is the right one for you. Thousands of people get into debt and seek debt advice every year when they fall behind with their mortgages and some even face home repossession. Make sure you get the mortgage to suit you and don´t be palmed off with the first one that is discussed. This is your house, your future and your mortgage, and by taking your time to find the right mortgage you can avoid debt problems in the future.

1. Help and advice to avoid debt

Seek the help and advice of a good mortgage broker who will explain Zero mortgage deposits, capped rate mortgages, fixed rate mortgages and flexible mortgages. Don´t be afraid to ask questions. Buying a house is probably the biggest purchase you will ever make in your life so take your time. Choosing the wrong mortgage could mean you end up with serious debt problems later on. This is one of the biggest decisions you will ever have to make in your life, so make it carefully.

2. Arrange a mortgage before you start searching for a house

One of the biggest mistakes first time home buyers make is to find their ´perfect´ property before they know how much they can borrow. The risk then is that they over-borrow and find themselves in debt and seeking debt advice or help a couple of years or months down the line. Firstly, find out if you can get a mortgage and how much for. You can then apply for an agreement in principle. This will cost you nothing and will not tie you to any one lender, but will give you a good idea of how much money you can borrow. Take your time to get the right mortgage deal for you and you can avoid debt problems further down the line.

3. Understand your finances to avoid serious debt problems

Go through your finances with a fine toothcomb to make sure you can afford the repayments of any mortgage you take on. Serious debt problems can arise if you borrow too much money and then have problems paying it back. If you choose the wrong mortgage terms and conditions you could end up facing house repossession and seeking debt advice and help. Contact Experian or Equifax for a copy of your personal credit history and if your credit rating is low, take steps to improve it.

4. Bad debt and poor credit rating

Often, only after first time buyers have submitted a mortgage application do they find out about their poor credit rating. This can create problems with borrowing money, and it is a good idea to check your credit rating before applying for a mortgage. Save time by checking your credit rating early on, and avoid debt problems later. If your credit rating is low, you may not even get a mortgage, or if you do, you could end up getting less than you bargained for.

5. Budget for the extras to avoid debt

Bear in mind that your new home, even if it has been recently built, will need furniture, and an older property may need extensive renovation. Consider all the extras before making an offer, and make sure you can afford it. Stretching yourself to afford an expensive house may seem like a good idea at the outset, but can cause serious debt problems and even house repossession later on. In your list of expenses, also include stamp duty, duty land tax, surveying and conveyancing. Look out for hidden extras which can trip you up if you don´t consider them at the time of taking a mortgage.

6. Monthly household bills

When you buy a house, you need to consider all of the ongoing expenses that come with it. In addition to monthly mortgage repayments, you will be liable to pay council tax, service charges, household repairs and utility bills such as gas and electricity. Work out how much the monthly bills are likely to be before applying for a mortgage. You can look on several utility comparison sites on the internet to give you an idea of how much you are likely to be paying in your area each month for gas and electricity.

7. Information to avoid council tax debt

If you are viewing the property with an estate agent, ask them which council tax band the property is in, to avoid debt problems later on, and how the local authority levies the charges. Council tax is a contentious issue, and you don´t want any nasty surprises with high charges after you have bought the property. Check the local rates bills before committing yourself to buying a property, and make sure everything is clear in your mind before going ahead.

8. Research the area to avoid debt when you want to re-sell

We have all heard the horror stories about house prices plummeting after new roads are built close to properties, or groups of travellers come to reside on your doorstep, but you can help avoid debt problems in the future by researching the area where you want to buy. Look at what is selling and for how much. All sorts of factors can add value to your property. Is it close to a bus route for example, close to shops and amenities, and close to schools? All of these things will add value to your property, meaning you will avoid negative equity in the future.

9. Local transport to work

When viewing properties, ask about local transport links and work out how much time you will add or lose by moving to the area. If you are moving to the suburbs of a city because property is cheaper, don´t lose out by having to pay sky-high transport prices to commute. Buyers can often be swept away by the feel-good factor when viewing their ´dream home´ only to realise a few months down the line that it is in the wrong area or that local amenities are not up to scratch.

10. Clear your debts and feel at home

If you have any outstanding debts, or debt problems, seek debt advice in the UK before applying for a mortgage. You may be instructed to clear these debts before you are offered a mortgage, to ensure you don´t suffer more debt problems in the future. Have a good walk around the area to make sure it is the right place for you to buy a house. Are there shops, pubs, leisure facilities close by? Would you feel safe walking home at night? Don´t make any split-second decisions just because you like the property. There are a lot more things to consider.Debts.org is a specialist debts advice company who can help you get out of debt, offer you a debt management plan, an Independent Voluntary Arrangement, reclaim unfair bank charges or mis-sold payment protection insurance in Liverpool, Leeds, London, Preston, Stockport, Middlesbrough, Oxford, Poole, Telford, West Bromwich, York, Slough, Gloucester, Cambridge, Exeter, Rotherham, Reading, Nottingham, Burnley, Bradford, Leicester, Bristol, Hull or any other UK city.

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