Home repossessions are the last resort, says Absa bank
DURBAN - South Africa's Absa bank has reassured its clients that repossessing a home is the last resort should homeowners default on their mortgage payments.
“It is in both the homeowner’s and Absa’s best interest that we do everything we can to sell the property before we reach the last mile: repossession,” said Mbuyiselo Khumalo, head of Absa’s Home Loans Collections, on Monday.
“Nobody wants to implement evictions and repossessions, it can be soul-destroying. Know that Absa will do everything possible to help you keep your home.”
Following the outbreak of Covid-19 in South Africa, the financial burden on citizens has been colossal.
The national lockdown, which commenced in March, has put businesses and individuals in economic despair, with thousands losing their jobs.
“We work extensively with our customers in an attempt to resolve any financial distress they are facing,” said Khumalo.
“Should a customer be faced with the unfortunate situation of not being able to meet their home loan payments for a couple of months, or worst-case scenario, being unable to meet their home loan instalment commitments in totality, Absa has processes and tools available that can be engaged to assist them through this troubled time.”
A home repossession takes place when homeowners fail to keep up with repayments on their mortgage loan.
The bank or the credit financier on the home will thereafter attempt to sell the property to recover the balance due on the loan.
“The sooner a customer advises us of their financial situation, the sooner we can look at the short- and long-term options we have in place,” said Khumalo.
According to Khumalo, only once the homeowner has explored all the available options to make the repayments and owning the home is no longer an option, will Absa introduce the client to an “assisted sales programme”.
“If none of the options applied have assisted the customer to retain or sell the property, only then do we follow the legislated foreclosure process to repossess a property,” he said.
This is a regulated process whereby Absa would approach the courts for consent to proceed with attachment and the sale of the property through a sheriff’s auction.
“The property is thereafter repossessed by the bank only if it is the highest bidder at the auction,” added Khumalo.
However, Khumalo said if the homeowner does not vacate the property, the new owner will have to follow an eviction process.
“It is also not the bank’s responsibility to facilitate the customer finding a new property; however, this is something we are reviewing currently as we extend Absa’s caring arm for its customers,” he added.
- African News Agency (ANA)