Repossession - The Worst Kind

I just read a story about the supposed 'biggest repossession in Britain' as an £11million mansion has just been repossessed after a former banker and tycoon racked up debts too large to ensure he kept possession of his beautiful mansion.

I think this sums up all too clearly the economic crisis we are in. The owner, Robert Bonnier has reportedly managed to accumulate debts of around £15 million. The credit crunch wiped 20% of the home's value, which is ironic to think that Mr Bonnier paid £3million more than the property's asking price when he purchased it last year.

It is a shame that repossession is so drastic, but since Mr Bonnier was once a banker, one would assume he was only too aware of his finances and how to manage them, yet it would appear not to be the case.

Not long ago, we heard the very sad story about Christopher Foster killing his family in a frenzied attempt to try and end his financial woes. His mansion was about to be repossessed after it was revealed that Mr Foster owed £1 million to suppliers and £800,000 to the taxman. (Source: The Sun Online)

It has been reported that Foster set the mansion ablaze just a few hours before bailiffs were going to arrive and serve him his papers to repossess the mansion.

Financial worries can drive a man insane. Facing repossession is like having everything you have built up over a number of years suddenly taken away from you. The house that you love suddenly gone. This has been the problem with having such a good economy for so long, and money readily available. People get into debt and then cannot afford to get out of it. I just hope the nature of the story above is the only one of it's kind.

Mortgage Debt And The Fear Of Repossession

When you take out a mortgage, naturally you then become in debt. It is a loan you are taking out and therefore has to be repayed. I think some people forget that a mortgage debt is still a debt, yet it is slightly different to a normal credit card debt, for example.

With a mortgage debt, you have to ensure that you keep up your repayments on the home you have, otherwise it may be repossessed.

Repossession is a drastic move, but sometimes it is the only way for lenders to claim back the lost money. In August 08 it was reported that the number of homes being repossessed has risen by an incredible 24% since 2007. These are worrying figures which mean people have been attracted by the offers of 100% mortgages which they can then not repay.

Lets just clarify the repossession process. It does not always mean that the mortgage holder loses their home. It is more a case of when the court grants an order for for the possession of a home. This process can actually be abandoned if the mortgage lender and borrower can come to some sort of agreement for a repayment deal.

In the second three months of 2008, mortgage possession claims grew by grew by 17%, compared with the same period a year earlier.



MORTGAGE POSSESSION ORDERS MADE - Source: Ministry of Justice




I think this shows just how big a mortgage debt can be, and taking out a 100% mortgage that you can't afford just isn't recommended, nor is it likely to be something offered by lenders anymore.