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Page last updated at 10:50 GMT, Friday, 31 October 2008

Have Your Say: Repossession

A monopoly house on a pile of coins
The FSA also has rules relating to lenders and homeowners in arrears

One of the signs of the economic downturn is the rising number of people losing their home because they have fallen behind with their mortgage payments.

Earlier this week the government issued guidance to judges in an attempt to ease repossession rates.

Gordon Brown told the Commons that lenders would have to demonstrate to the courts that they had exhausted every avenue before pursuing struggling borrowers.

In an additional move, the government also announced that it plans to bring firms offering mortgage rescue schemes under the regulation of the city watchdog, the Financial Services Authority (FSA).

Has your home been repossessed? Tell us about your experience.

Should the UK government intervene to assist those facing difficulty in paying their mortgage?

Does extra protection encourage people to act in a more irresponsible way?

We asked for your comments, a selection of which are below. The debate is now closed.


What good would it do any mortgagee to repossess property in the current market? Who would they sell it to in order to recoup their losses? Surely it is better to negotiate terms with the mortgagor such as: 1. Extending the length of the mortgage thus lowering repayments. 2. "Freezing" the mortgage, taking legal possession of the property and allowing the mortgagor stay on in their home as a tenant, paying an agreed rent, with the option to transfer ownership back to them as soon as they are in a position to resume mortgage repayments starting from the point at which they were frozen. 3. Entering into agreements with local councils where there may be an interest in increasing council-owned housing stock. The council would effectively take over mortgage repayments to the bank and the borrowers would be changed into council tenants without having to change home.
Pauline Gerosa, Ealing, London

I don't really want anyone "blaming anyone else for the lending" - what happens now, with borrowers in trouble, well, I am definitely on the warpath with that one. The trouble with the blame culture is it solves nothing and merely sets one side against the other to no good end - they are both equally culpable and liable - and it has, disgracefully - spread quickly to the general population where the "haves" are blaming the "have nots" which is the last thing a divided country like the UK needs at this time. It is indisputably true however that the financial institutions started the blame game. The whole business of repossession and the way it is handled "legally" is a disgrace. I can only speak for the UK.
Guy Croft, Lincoln UK

It is the responsibility of the borrower to insure against these risks

Sean, Bucks

The media seems to portray all people subject to repossession orders as "victims". A mortgage is usually the biggest financial commitment people will ever make. To take on such a loan and expect economic and personal circumstances to remain constant for the loan term is totally irresponsible. The risks involved are clearly stated when the mortgage is taken out and it is the responsibility of the borrower to insure against these risks. If the homebuyer has not budgeted for reasonable increases in interest rates and mortgage insurance then they should settle for a smaller property or rent until they can afford to comfortably buy.
Sean, Bucks

Repossession should not be seen as universally negative. The whole point of a mortgage is that the loan is secured on your home and one knows that the monthly payments will go up if interest rates rise. If property prices and wages rise then it's fine. If mortgage payments go up but wages and/or property prices lag behind then why not let the repossession go ahead and then start again with a clean slate?
Chris, Bristol

They should help those that have been good payers up to now and give them some breathing space

Mr Grout, Leicestershire

In the last recession we fell behind with our payments. We tried everything we could with our lender but they kept sending letters and charged us God knows how much to do so, which was added to out arrears. Even though we were paying 50 extra a month over our due payment they still took us to court to try for repossession. The judge told them what he thought about their actions and ruled in out favour. I now have the deeds to our property and would never deal with that lender again. People should be given a chance to get back on their feet, interest should be frozen and charges for letters should be waived while people are struggling. After all the government are helping them, so they should help those that have been good payers up to now and give them some breathing space.
Mr Grout, Leicestershire

During the current discussion on house repossessions, can someone please assure the public, or explore with ministers, that buy-to-let speculators, who gambled in a marketplace and lost - and by the way helped inflate the housing bubble in the first place, will not be given the same gentle treatment as genuinely deserving householders who may face loss of their only home?
Clive McAfee, Richmond upon Thames

Is this helping to keep people in their homes?

Roger, King's Lynn

My daughter is currently going through a messy divorce and would like to keep her house (husband & father of her two-year-old son will not pay mortgage so she wants him off the mortgage). They have a 156k mortgage, they took a 12 months mortgage holiday which is about to start again in December - approximately 1,000 per month. When the divorce is finalised (which will not happen until the house is sorted) she should have around 16,000 in cash. Because of the baby she only works one day a week as a teacher. She has asked the lender if they will sign over the mortgage to her, she has offered to place a years mortgage payment into an account with them which she cannot access but they have told her they will not sign the mortgage over to her, will not accept the years payment and if the joint payments are not paid they will reprocess. Is this helping to keep people in their homes?
Roger, King's Lynn

In order to lay the horror and fear of repossession for ever (for those who innocently are unable to pay) I suggested a scheme to the government two weeks ago. A National Property Trust would be set up. All lenders and borrowers would pay a premium into it plus an amount from the government. When, through no fault of their own (illness etc) a borrower is unable to pay, the trust would take over the payments for as long as necessary. It would automatically acquire a legal charge equal to the amount it has paid in proportion to that owing. On the sale or disposal of the property the trust would recover its outlay plus a small rate of interest. The government would save a fortune in benefits. A lot of unnecessary Court time would be saved and thousands would live happily ever after. It would be a big boost to everyone's morale and to the housing market - and be a world first.
Leonard Wells, Haslingden, Lancashire

Have they got it hard now? I think not

Anonymous, Bromsgrove Worcestershire, UK

I just don't get it. There is much being said about mortgage borrowers needing help with their interest rates and that we should lower the cost of borrowing. Interest rates are pretty low compared to when I started the mortgage on my present house back in 1987. The rate then was 15% or 15.5% for a repayment mortgage. I can remember the 400+pcm repayments were crippling but I managed. I knuckled down to paying much higher fuel prices, telephone etc relatively speaking and a after some good years of business I have paid my mortgage off early. On top of that my endowment has a shortfall, at the last check, of some 10,000. Have they got it hard now? I think not. I'm only thankful that I had the good sense to plough my spare cash into my mortgage otherwise I could be staring at finding an extra 10,000 so that I could keep my modest three bed terrace home. Would the government like to pay me the difference on my endowment? I think that might fall on deaf ears.
Anonymous, Bromsgrove Worcestershire, UK

One difference between this and the last recession is that there is no support for mortgage repayments in the social security. The government expect one to have bought an insurance policy to protect the repayments. I wonder how many people have. I know that I found the cost prohibitive.
Ian, Southampton

This to my mind is fraudulent
Mrs Joan Smith, Chesterfield
When a property is repossessed why is the mortgage lender not obliged to sell it at the highest possible market price? A newspaper today reports a man who has lost his home, which had been valued at 400,000, and which the mortgage has put on the market at 260,000. This to my mind is fraudulent and leaves the way open for developers and buyers with spare cash to make a killing. After paying off the loan and other expenses of the lender, a dispossessed home owner should have the remainder given back to him. This could even be enough to buy a smaller property with an easily payable mortgage if one were needed, and also relieve what must be an endless misery.
Mrs Joan Smith, Chesterfield

Apparently Govan Law Centre experience over the last twelve months reveals that 98% of debtors have complied with section two orders and have retained their homes. This is considerably higher that the compliance rate in England and Wales which runs at around 45%. Perhaps they should copy this process.
Alex, Ayrshire, Scotland
(Editor's note - A section two order only applies to Scotland. It is a court order which can either stop your lender from repossessing and selling your home - giving you an opportunity to clear your arrears, or allow you time to find alternative accommodation before you have to move out, if your lender is permitted to repossess your property - the property cannot be sold whilst you are living in it.)

The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.

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