France and Scotland: notes of Repossessions


“Such scenarios are rare in France where the Ministry of Justice recorded only 13,568[1]  court foreclosure proceedings “[2]On an estimated[3]  10.8 million mortgages in France that is 0.125% of all mortgages

“Last year, French reforms regarding the repossession of properties were passed to increase the creditors’ protection as well as giving debtors additional options when faced with financial hardship, reported Mr Robin, allowing an owner four months to sell his/her property before any seizure procedures can begin. “[4]

A life insurance policy that will cover payments in case of unemployment or death is a mandatory part of a French mortgage, a requirement that is sometimes very costly depending on the loan.

Pursuant to the French Consumer Protection Code, borrowers can apply for a ‘repayment holiday’ (deferred payment) of up to 24 months if they are suffering financial hardship. Where the mortgage in arrears is less than 3,800 Euro, a simple Application, rather than a Summons, can be filed with the local Court. This, if applicable, must be done prior to lenders formally issuing a notice of foreclosure, i.e. that the borrower is defaulting on his/her loan repayment.

In an equitable procedure, the debtor is allowed to find a purchaser himself. In an enforcement procedure, the property will be auctioned.

A/ Flexibility allows the debtor to find a purchaser himself. The request for a voluntary sale may be submitted and adjudicated prior to the service of summons to appear at the directions hearing (it then suspends the course of the proceedings), or it may be submitted by the debtor at the directions hearing, as we have already seen on the plan. This option is of course under the control of the judge who checks that the price offered for the foreclosed property is at the market price.[5]

In the winter period (from November 1st to March 15th no eviction from private property may take place)

The major novelty of the law of 2006 is that the sale judgment includes an eviction order on the foreclosed party.

DS – just talk to banks in all these countries.

There are two Scottish Government schemes (as part of the Home Owners’ Support Fund HOSF) to help owners who are finding it difficult to pay loans secured against their property: Mortgage to rent: a social landlord such as a housing association or local authority buys your home and you continue to live there as a tenant

Rules mortgage lenders must follow before repossession

Before a mortgage lender takes you to court to repossess your home, it must follow the rules outlined in the pre-action protocol.

Key advice

  • Make sure your lender gives you details of your arrears
  • Work with your lender to explore all options for paying

Rules your lender must follow

If you have mortgage arrears your lender can take you to court to repossess your home.

But there are rules that mean your lender can only do this as a last resort and after other options have been exhausted.

Your lender must treat you fairly and consider any reasonable requests you have to arrange to pay off your arrears. These rules are called pre-action protocol.

If your lender doesn’t follow the rules it could affect the outcome of a repossession case against you.

Get legal advice about mortgage arrears and repossession as early as you can.

Before a lender can start action against you

Before taking any steps to repossess your home, your lender must try to discuss your finances with you and give you a reasonable chance to pay the arrears.

Your lender must also send you:

Both leaflets offer advice on what steps you can take to keep your home.

Your lender must communicate with you in a way that’s clear and easy to understand. Tell them if you find it difficult to understand any information they send you.

Your lender must also give you details of:

  • your payments over the past two years
  • your monthly instalments
  • the amount of your arrears
  • how much is left to pay on your mortgage
  • the interest or charges that will be added


Your lender should also delay court action if:


What happens if your lender doesn’t follow the rules

If your lender hasn’t followed pre-action protocol the court could:

  • give you time to negotiate with your lender by delaying the court hearing
  • order the lender to pay your legal costs
  • stop your lender from adding their costs on to what you already owe them

Get legal advice before the court hearing if you think your lender hasn’t followed the rules.

  • Lenders tried to sell repossessed properties quickly. However, they would normally avoid auctions unless the property could not be sold using the normal channels or was of very poor quality.

7 Typically, the lender wants to make a quick sale. Most do not routinely put the properties into auction, they try to market first in the normal way. The average time they expect to sell properties within is 20 weeks. However, for a property that would not sell, they would use auctions as a last resort with a reserve price. One lender said that they had 61 Scottish repossessions and only one had been auctioned. Another lender said they would use auctions in a deprived area, as they would sell the property quicker this way. Another lender said that under 10% of properties went to auction, but that auctions had become more prevalent over the previous four years. There was a common policy that, if a property had been on the market without selling for a long time, then it would go to auction.[6]

One lender said they lost about 75% of the value of shortfall debt, another said they wrote off one-sixth of shortfall debt this year, costing around 6 million, another just described the percentage as very high, another said about 12,000 was lost on each home and they would be lucky to get 3-5% of this back. Another lender said all shortfall debt was written off immediately.[7]


In Scotland there are around a million mortgages[8]. There are about 4300 repossession decrees granted and 2383 actual repossessions.[9] This would thus be about 0.2% of all mortgages.





[1] This is the figure for 2005, according to the article 2006 and 2007 are similar. The article in the note below goes on to say:  “As a result of [subsequent] precautions, the ratio of property seizures for default of loan payments in France to the USA is 1:25, based on an equal population scale.”

[2] quoting Jean-Pierre Robin, economic journalist for Le Figaro.

[3] There are 25.2 million households in France and an owner occupancy rate of 65% (Wikipedia). We assume the fairly common ratios of 1/3rd of mortgages already paid off and 2/3rd still being paid. This calculates to 10.7 million