If you are struggling to pay your foreign mortgage, know that you’re not alone & that there are options available to you! You can easily resolve these issues if you approach them in the right way. However, the process can be complicated and it can be easy to make mistakes along the way. Although we always recommend speaking to the experts, here are a few common mistakes to avoid if you can’t pay your mortgage:
Handing Over the Keys
One of the most common mistakes with this issue is to simply hand back the keys to your lender. Unfortunately, this does not free you, especially if you are in Negative Equity. By doing this, you are putting yourself in serious jeopardy as banks can pursue you for the outstanding debt back home. If you don’t pay your mortgage, arrears will mount on your account. Following a period greater than three months your lender can commence repossession proceedings.
Once repossessed, your lender will then likely market the property. Lenders often sell these properties at a reduced value, often around 60% of market value. This can increase losses for both the Bank and the borrower.
Any money from this sale will be used to pay the remainder of your mortgage. If this does not cover your mortgage you will be left liable for any shortfall balance. Lenders can then collect the resulting debt in your home country. We have seen instances when lenders have appointed UK Collection Agents and placed a second charge on homes back in the UK.
Hope That Brexit Will Fix It
Even with the uncertainty of Brexit looming on the horizon, Spanish Banks have suggested that it will remain business as usual when it comes to foreign mortgages and chasing debt. Some people purposely voted ‘Leave’ in the hopes that their mortgage issues would be solved. Unfortunately, the solution is not that simple. In fact, the situation may be made worse by the decrease in holiday home prices resulting from Brexit.
Don’t Talk to the Lender
If you are worried about your mortgage, it can be tempting to bury your head in the sand. But it is essential that you talk with your lender if you have any issues paying your mortgage. Lenders can pursue you in your home country and by ignoring them you are putting your foreign property and your assets in the UK at risk, including your pension. The best solution is to deal with your mortgage lender directly with the right representation – EU Property Solutions can help you through the process.
Go It Alone
Whilst the best solution is to talk directly with your lender, many people don’t know how or where to start. EU Property Solutions have over 10 years of experience assisting borrowers with property debt issues across Europe. Our main area of expertise is in Spain, Portugal, and Cyprus but we are obtaining successful settlements across the continent. At EU Property Solutions we will work with you and deal with the lender on your behalf. We have a dedicated legal team based in Spain who deal with Foreign Mortgage issues every day and would be happy to assist you.
Our team offer FREE no-obligation consultations. We can do this via telephone, consultation, a Zoom call or a face-to-face meeting in one of our offices across the UK. Avoid making these foreign mortgage mistakes by calling us today on 0330 124 1230 to arrange your consultation.