What are your costs of going to court for a repossession hearing?

Falling behind on your mortgage payments is one thing, but having to face a court hearing which may result in you losing your home is on another scale, not to mention the costs of going to court.

I had a look into this and came up with the following break up:

First and foremost, there are the direct costs of going to court and the initial financial hurdle in the repossession process is the court fee.  When a lender decides to pursue repossession, they must apply to the court, and this application comes with a fee. As of my last update, this fee was around £355. This cost is typically passed on to the homeowner, adding to the existing debt.

While it’s not a requirement to have a solicitor represent you during the repossession hearing, legal advice is invaluable. However, solicitor fees can vary widely based on the complexity of your case and the solicitor’s expertise and legal aid might not be available if you don’t qualify.

If your case involves more complex legal challenges, such as disputes over property boundaries or allegations of unfair lending practices, additional costs can mount up. These might include expert witness fees, additional legal research, and extended court time.

Then there are the indirect costs. While not a direct out-of-pocket expense, the impact on your credit score following a repossession is a significant indirect cost. A repossession can remain on your credit report for six years, affecting your ability to secure loans, credit cards, or even rental agreements.

Emotional and physical health may also add to the indirect costs. The stress of facing a repossession hearing can take a toll on your emotional well-being and physical health. This is often overlooked and can lead to increased medical expenses and a potential loss of income if you’re unable to work.

What can you do to avoid these costs? Well, the sooner you communicate with your lender about financial difficulties, the more options you might have to avoid court altogether. We found that many lenders are willing to discuss alternative arrangements, such as payment holidays or mortgage term extensions.

Seeking advice from numerous UK organisations that offer free advice to homeowners facing repossession, is strongly recommended. Engaging with these services early can provide important guidance and potentially identify pathways you hadn’t considered.

For some, selling the property before it reaches repossession might be a viable way to avoid the court process and its associated costs. This route might not only settle your mortgage arrears but could also provide a fresh start, free from the burden of unsustainable debt.

However, If your case does go to court, attending the hearing can significantly influence the outcome. Demonstrating a willingness to resolve the situation can lead to more favourable terms and potentially prevent repossession.

Facing home repossession most definitely presents a challenging emotional and financial strain. Yet, understanding the associated costs and exploring every avenue to mitigate them is a vital step in helping you get through the ordeal. Just remember, support and guidance are are always available, you can find organisations that might be able to help you on our website.

If you have recently faced a repossession hearing, we would love to hear from you and perhaps your experience could help others.