Mortgage repossession

What happens when your home is repossessed

If your home is repossessed, you have responsibilities until it is sold.

Your lender will recover what you owe them by selling your home. If this does not cover the full amount, you’ll have to pay them the remaining amount. This is sometimes called a mortgage shortfall.

Your responsibilities after repossession

Mortgage or loan payments

Once your home is repossessed, you do not have to make payments on the mortgage or loan. Interest will still be charged until the property is sold. These charges will be deducted from the sale.

Repairs and maintenance

You’re responsible for repairs and maintenance until the property is sold.

If you’ve moved out, your lender will arrange repairs and maintenance. They’ll deduct the costs from the sale of the property.

Insurance

You’re responsible for insuring the property until it’s sold. If you’ve moved out, this may make your current insurance invalid, and you’ll have to arrange temporary insurance.

Council tax

You’re liable for paying the council tax until the day you move out.

Contact the council tax team and let them know the date you’ll move out. Use our letter template to report a change to the council.

Moving out after your home is repossessed

Sheriff officers will usually send you a letter telling you the exact date and time you must move out by. This letter is sometimes called a charge for removal.

If you do not move out in time

Sheriff officers can use reasonable force to remove you from the property. They can secure the property so that you cannot get back in.

Police officers can be present at the removal, but they cannot help the sheriff officers. They can arrest anyone who behaves violently.

Making a complaint about sheriff officers

You can make a complaint if you're concerned by the actions of sheriff officers or if they damage your belongings. For information on how to complain, check Citizens Advice guidance on sheriff officers.

If you have a mortgage shortfall after your home is sold

There are a number of options to pay back the shortfall. You can do this over a number of years.

If you’re not sure how you’ll pay, get money and debt advice. An adviser can help you budget and plan how to repay the shortfall. They can negotiate with your lender for you.

Writing off the debt

It’s unlikely your lender will write off all the debt. They may write off some debt if you can pay a lump sum and instalments.

Paying instalments

Your lender can agree to let you pay in instalments. They’ll usually allow you to do this over a number of years, as long as it’s within the original term of your mortgage.

Only propose a plan that you can afford. A money and debt adviser can help you make a repayment plan.

Lump sum payments

If you can afford to pay a lump sum, this will reduce the amount you need to offer in your repayment plan. Your lender may agree to write off part of your arrears if you can pay a lump sum.

Bankruptcy or sequestration

If you’re bankrupt, any assets you have will be sold to pay off your debts. After this, your remaining debts can be written off. If a court declares you bankrupt, this is sometimes called sequestration.

Bankruptcy is risky and can prevent you from borrowing money in future. Always speak to a money and debt adviser before declaring bankruptcy.

If you think the shortfall amount is wrong

You can dispute the shortfall if your lender:

  • significantly undervalued your home when selling it

  • did not properly advertise your home before selling it

  • blocked you from selling it yourself, then sold it for less than you were offered

Get legal advice from a solicitor if you want to challenge a shortfall amount. Find a solicitor on the Law Society of Scotland.

You could get legal help for free or at a lower cost.

Last updated: 17 March 2023

Housing laws differ between Scotland and England.

This content applies to Scotland only.

Get advice if you're in England