What can you do if your lender is trying to repossess your home?
The thought of losing your home is enough to give any homeowner sleepless nights but there are options if you find yourself falling behind on your mortgage.
According to the latest figures, there are over 66,000 residential mortgages in arrears across the country. Over 28,000 of those mortgages are in arrears by more than 720 days, which shows the extent of the problem.
If you’ve fallen behind on your mortgage, the prospect of appearing in court is a daunting one. There’s the fear of losing your home, the uncertainty over what will happen, and the stigma of going to court for what is often the first time. It’s a stressful experience but there are support structures to help people to deal with the threat of repossession.
Contact Abhaile today
One of those options is Abhaile, a state-funded mortgage arrears support service that works to help people to stay in their own homes. To qualify for this free service and get expert advice and support, you need to meet the following four criteria – you must be in mortgage arrears on your home, insolvent, at risk of losing your home and reasonably accommodated (that means the costs of living in your home are not disproportionately expensive).
You can sign up to Abhaile by contacting Money Advice & Budgeting Service (MABS). We spoke to Patricia Murphy of MABS, who works as an Abhaile court mentor, to find out what you can do if you’re facing repossession.
“The lender is obliged to follow the Mortgage Arrears Resolution Process (MARP) so when you run into arrears, they have to advise you by letter,” explains Patricia. “They are required to give you full information about the MARP so that you’re aware of what you’re supposed to do. Unfortunately, a lot of people bury their heads at that point. They can’t cope with it.”
The lender will look for a standard financial statement to assess the borrower’s situation and will request supporting documents like payslips or social welfare slips. The lender will then see if there is any kind of a plan they can offer the borrower. Initially, this might take the form of a short-term, six-month plan that can then be extended if it appears to be working.
Engage with the process
Abhaile advises homeowners who find themselves in arrears to engage with their lender and provide any information that the lender requests as part of the process. This prevents the homeowner from being deemed uncooperative under MARP and it’s the best way to avoid the possibility of legal proceedings. MABS can help you to complete documentation if required and to assist you in the process.
There are cases that end up in court where, through no fault of the homeowner, the mortgage is deemed unsustainable because there is no repayment capacity. In other cases, a resolution is possible with the lender but it results in court action because the homeowner refuses to engage.
If you’re nervous about dealing with your lender or intimidated by the prospect of filling out financial forms, you can contact MABS for advice. Getting your first court summons can be frightening for a homeowner but it doesn’t mean that you’ll have to hand over your house keys. Cases are often adjourned on the homeowner’s first visit to court.
As part of the Abhaile scheme, there are MABS advisors and duty solicitors assigned to possession court to offer support.
“There are people who never expect to end up in the courts in their life and it’s really daunting. That’s what we’re there for – to show support, make them a little bit more relaxed, show them around the court, tell them what will happen, how to stand and where to stand – all the basic things that people worry about. We can advise them on the best thing to do, refer them to a dedicated mortgage arrears advisor or potentially a personal insolvency practitioner (PIP) – it just depends.”
Early engagement makes a real difference to achieving a resolution as it gives the homeowner time to consider all options and avail of any supports and advice that are needed.
Examining your options
Once you get to the court stage, the options that are available to you will depend on your personal circumstances and your history of engagement. Even if your mortgage is deemed unsustainable, there are still options that you can pursue with the help of Abhaile.
“For people like that, they can potentially look at personal insolvency and maybe legal advice as well,” says Patricia. “Mortgage to Rent could be another option for some people. It may not suit everybody but it’s still an option.”
If you find yourself in need of help, you can contact Abhaile to get a mortgage arrears advisor to assess your case and offer you advice on how to proceed. You can contact Abhaile on the MABS helpline from 9am until 8pm from Monday to Friday. Alternatively, homeowners who want to look at insolvency options can also contact one of Abhaile’s PIPs directly.
“What we would do in court is take their contact details, do an assessment over the phone and refer them directly to a dedicated mortgage arrears advisor or a PIP. So there’s support there the whole way. We’d always try not to let people leave without looking at the full picture of what can be done and referring them in the right direction.”
The supports that are available under Abhaile are available nationwide so you can get help no matter where you live.
MABS mortgage arrears advisors can refer borrowers to the Abhaile duty solicitors who attend the possession courts if some on-the-spot advice is needed. Abhaile will also provide its clients with free vouchers so that they can access solicitors for legal advice outside of court, financial advisors if the case figures are in dispute, or PIPs if they want to investigate the option of insolvency or bankruptcy. So Abhaile provides the advisors you’ll need at any stage of the process.
It’s a free, confidential service that is open to anybody in home mortgage arrears and Patricia urges anyone who is struggling with mortgage arrears to contact Abhaile. While it’s always best to engage with Abhaile as early as possible, it’s never too late to make contact. They have achieved favourable outcomes for borrowers, even when the case is very far advanced in the legal process.
“We have people that call and say ‘I’m in court tomorrow. What can I do?’” explains Patricia.
“So, you talk them through it and refer them to an advisor. There mightn’t be time for them to see an advisor if it’s the next day but, if it’s three or four days away, sometimes the advisor can try to fit them in before the court date. The person can then go to court and say ‘I have engaged. I’m waiting to see a MABS advisor’ or ‘I’ve seen a MABS advisor and we’re in the process of doing a financial statement so we’re asking for an adjournment.’ So that can be helpful in court.
“The main thing is to communicate and engage.”
If you or somebody you know is in mortgage arrears, or you fear you are at risk of losing your home, you may be eligible for free face-to-face financial or legal advice under the Abhaile scheme. For information, call the MABS dedicated helpline on 076 1072000, or visit the website.