For any individual, Repossession is a not a pleasant word, it is a horrible situation and hurts the dignity of an individual. There is no situation in this world which doesn’t have a solution for it. Unfortunately, in this slowdown, recession, credit crunch repossession occurs often. Even if there is a “no cure” situation there will be an option of “prevention”! When certain steps were taken there is a great chance for stopping repossession.

Debt Prioritization
For a majority of people Mortgage loan will be the biggest debt. Prioritize this but don’t pay it fully. No court will order to seize your land at first step but at the last. Though Mortgage is in the top list of the priority you can leverage it when you have a tough time paying other loan. But, only when the situation is really tough. This should be consulted with a Debt counselor. They know both the Law & Finance.

Protect Mortgage with Mortgage Insurance
Choose a policy which suits you the best, if it exists for you. This may cover a situation like sickness, unemployment etc.,  Normally the span for these type of insurance will last for 12 or 24 months.

Claim for Mortgage Interest
This depends on the eligibility. If eligible for income support or other allowance, it may be possible to get assistance in paying the mortgage interest. There are few condition like if the mortgage is taken before 1995, one can claim interest for up to a million dolor. These issues are to be consulted with a debt/mortgage consultant.

Sell or Rent it!
Selling the property is much better than repossession. If  you firmly belief your situation is very much temporary & is of very short duration rent it provided there is a minimum of 25% of equity in that property.

Negotiate with Lender
If you are unable to pay your loan, you can talk to the lender and explain about the situation. There is always a possibility for a negotiation for a loan modification like reducing installment or an interest only mortgage. There are ways, it depends on your negotiation or let a negotiator do this on your behalf and presence.

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