Sell and Rent Back: All You Need To Know
The forecast for homeowners is definitely
not the most promising. The figures show that repossessions are currently
as scary as the last recession in 1991 when 75,500 homes were repossessed.
The estimate for this year in the UK is 75,000.
To fight back against these figures a system has been
developed called the sell
and rent back scheme to which offers a sustainable alternative
to the almost inevitable trap of repossession.
The government have announced that lenders are free
to discuss with troubled homeowners, ways to minimize repossessions
by offering alternatives such as mortgage holidays but unfortunately
reality is quite different. Lenders are showing few signs of offering
such solutions but in some cases are acting quicker than ever on arrears
which means the possibility of the bailiff knocking on the door of
some homebuyers who are in arrears with their repayments.
The sell
and rent back scheme is a smart choice to keep those bailiffs
away. As the name suggests the home is sold and is then rented back
to the homeowner. This is a solution that will keep down stress levels
especially for families who have children in local schools and have
their lives established in the local area.
The Legal
process of sell and rent back is minimal and will be dealt by
reputable and experienced solicitors. The whole process is adjusted
to the pace of the requirements for each individual which gives adequate
time for the homeowner to be sure that this is the right solution.
The most important place in the world is home and
this is because one of the basic human needs is the need to belong.
Everyone has the right to have a place which they call home. With
this in mind the sell and rent back option was devised to provide
a solution for the homeowner who is in financial difficulty due to
the worsening economic situation. The sell and rent back plus buy
back (link: sell and rent back plus buy back) is also a simple development
to provide a homeowner with the chance to buy the home back at a future
date when the economic situation eases and the homeowner's personal
financial affairs recover.
Repossession should be the last resort because it
means the total loss of the family home for no benefit. All alternative
avenues should be explored for the right to keep the home. Some of
these avenues are:
Talk to the Lender
Mortgage arrears do not appear overnight nor do they
lead straight to repossession but they must be taken seriously. It
is advisable to talk to the lender early before any payments are missed.
As soon as the borrower feels that it will be impossible to make the
next mortgage payment, contact should be made with the lender immediately.
Lenders are more likely to help when there are no arrears and the
borrower discusses the situation with them.
Extra Income
Looking for additional sources of income such as a
part time job can be of great help in avoiding shortages which lead
to mortgage arrears, though this becomes more difficult in times of
recession.
Seek Advice
A letter from the Court does not mean certain repossession.
However it is extremely important to seek expert advice as quickly
as possible. The Citizens Advice Bureau can provide the information
needed as to what is likely to happen at any Court hearing and what
can be done about it. This advisor can analyse the case and see if
there is good reason why the homeowner should not be evicted.
Even when a judge decides to make an outright possession
order - meaning that the homeowner loses the right to remain in the
home - it can usually be stopped by a suitable sell and rent back
scheme if actioned quickly.
The repossession process always involves a great deal
of hassle and stress which can be avoided if the homeowner uses a
sell and rent back scheme as an umbrella to take them through the
economic storm safely. This can also give them the option to buy back
the home when things improve by using the Plus Buy Back Option.
