Voluntary repossession may be a 'sensible solution'

Posted: 17 Aug 2010 09:14:08 GMT

Voluntary repossession should be a last resort for homeowners, but it can be a sensible solution, one expert has suggested.

Co-owner of the Homeowners Advice Centre Chris Jenkins said Brits need to be aware that giving up a property voluntarily does not mean they will escape their debts.

"Even if you give the keys back to the mortgage company, if the lender has to sell the property at a loss in comparison to the mortgage amount, then they can pursue you for the debt," he added.

Mr Jenkins noted struggling with mortgage payments can have a detrimental effect on family life both psychologically and on the standard of living.

He advised those in arrears to seek advice and although handing the keys back is a drastic resort, life will go on afterwards.

The specialist's comments follow a report from the Department for Communities and Local Government, which revealed in 2009 those giving their properties back on a voluntary basis accounted for 26 per of all repossessions.
 

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