The moment it becomes a reality that you cannot pay your monthly bond payment, you should engage with your bank regarding your financial problems. It is in the interest of the bank to try and accommodate you and try and help that ultimately you remain in a position to pay. It costs far more to institute legal action and repossessing your property. Of course, the bank can only help in restructuring your debt by making your repayment period longer or giving you a payment holiday for example.
Where the bank feels it is favourable to assist you and have made an arrangement with you, it remains vital that you stick to this new arrangement, as there can be dire consequences for you should you default on this agreement as well. So, also make 100% sure that you understand the new arrangement and obligations that you are agreeing to. Should your financial position improve, it may also be worthwhile to approach your bank to request that you revert back to your original arrangement.
Where your position is however so severe that no arrangement or strategy is possible, it is still better to engage with your bank, as often they can assist you with the process of selling your property. Such a bank assisted sale can be more beneficial to you than an execution sale, as the bank will help to market the property and aim to sell the property at a market related value. Should the sale proceeds yield a shortfall, you may even discuss the option of a discount on the settlement of your outstanding loan balance or the shortfall may be converted into a personal loan which you will have to repay.
At the end of the day, it does not matter how grim your financial problem might appear to be, the bank more often than not will want to try and assist you with a solution and its better to open the conversation with them earlier rather than later to avoid a situation where your default forces the bank to take legal action against you.
Disclaimer: This article is the personal opinion/view of the author(s) and is not necessarily that of the firm. The content is provided for information only and should not be seen as an exact or complete exposition of the law. Accordingly, no reliance should be placed on the content for any reason whatsoever and no action should be taken on the basis thereof unless its application and accuracy has been confirmed by a legal advisor. The firm and author(s) cannot be held liable for any prejudice or damage resulting from action taken on the basis of this content without further written confirmation by the author(s).
