What is a Mortgage Arrears?
If you’re a homeowner, it’s not the bricks and mortar, but the mortgage that keeps the roof over your head. Yet many struggles to meet the monthly repayments, leading to arrears and the fear of home repossession is something many South Africans fear for every day.
If you’ve missed your mortgage repayments and have payments overdue, you’re ‘in arrears’. If you’ve not spoken to your lender yet, we suggest you do it immediately. Alerting your lender to the fact you may not be able to pay your mortgage on time is the first and most important step to help get you back on track.
This can also lead to a better relationship and you can even work out alternative payment schedules if the lender is able to accommodate.
Lawsuits are filed to collect these debts:
In the case of outstanding Mortgage Arrears, the creditor may have the right to file a lawsuit against the consumer to force payment of the debt through a judgment.
The lawsuit must be served upon the debtor according to the service of process rules of the state in which the consumer resides. Then, the consumer can defend the lawsuit by asserting various defences such as fraud in the creation of the account, or that the amount sought after is incorrect or has been paid, to name just a few.
If the case is not properly defended, then the creditor will obtain a judgment in its favour. When the creditor has a judgment, it may seek involuntary means to force payment such as wage garnishment, asset attachment or lien on the property.
How debt review can help those with a Mortgage Arrears
Using a Debt counsellors like ezDebt we will formally review your finances and develop a suitable monthly budget by negotiating with your creditors on your behalf
- Enables clients to make one monthly debt repayment
- Stops creditors from hassling you
- Decreases judgements against you
- Prevents you from declaring bankruptcy
- Maps out the path towards becoming debt free
If you’ve fallen behind with your rent payments, you should take action quickly to deal with the situation.