The recent outbreak of COVID-19 lead to massive loss of jobs all over the world and our dear Nigeria is not an exception. This has also caused a major displacement along various value chains. For the first time since I was born, humans deserted the streets of Lagos State, and Airplanes were absent from the skies of Agege.

In a Thisday online Newspaper publication of Friday the 12th day of June 2020, it was reported at about 5.00 am that the Osinbajo Committee predicted that 39.4million persons will lose their job by December 2020. This by extension simply means that not less than 20million household will be further thrown down the ladders of economic freedom. Their woes and that of their dependant compounded.

Let us assume without conceding that the Government of the day whether State or Federal had desires to bring governance closer to the masses during these unfortunate times. There is no doubt that the sudden drop in crude oil prices dealt thunderous slaps on the economy, leading to more fatalities than those alleged to have recently occurred in South-West of Nigeria.

These woes are further compounded by the inability of the Federal Government open the war chest of the Iron Bank and provide robust palliative packages cum bailouts, or non-interest loans to her small and medium scale employers of labour, as it did during the last global economic meltdown. Let's not forget the outright refusal of many financial institutions to offer fresh or restructure existing credit without viable collateral. Na house dem dey always ask you to go bring las las. But how many people get house to bring?

Most Nigerians are now venturing into entrepreneurship. This is a shred of incontestable evidence that Nigerians are indefatigable in their pursuit of a worthy endeavour and will do all it takes to ensure they come out of any difficulty even if it means taking a loan. However, getting a loan always comes with conditions of having collateral to secure the loan. The problem is not about getting the loan, the problem lies in repaying the loan and getting your property back. Most times, these properties used as collaterals, are landed properties because it is the most secured collateral one can use to easily secure a loan.

You will agree with me that business does not always go as planned and this leads to default in repayment, with interest accumulating and you can't meet up with the repayment right?? Not to worry, all hope is not lost. I will be sharing the steps you can take to redeem your cherished property if only you are willing.

To get a basic understanding of what I will be sharing, let us quickly define some key concepts.

DEFINITION OF MORTGAGE.

This is the transfer of a reversionary legal interest in a piece of land, chattel or equitable rights as security for the repayment of a loan or the performance of an obligation.

It could also be defined as the transactional legal relationship between a Mortgagor and a Mortgagee in a simple mortgage transaction, or between a Mortgagor, a Mortgagee and a Borrower in the case of a tripartite mortgage transaction.

The property transferred is called the 'security' for the loan or the 'mortgage property'.
PARTIES TO A MORTGAGE TRANSACTION.

The traditional mortgage transaction usually has two parties known as the Mortgagor/borrower and the Mortgagee/lender.
However, there is another type of mortgage transaction known as the[b] TRIPARTITE MORTGAGE TRANSACTION[/b]. Three parties are involved in this type of transaction.

They are:
1. The Borrower which in most cases is an existing company.
2. The Mortgagee/ Lender.
3. The Mortgagor /Guarantor/ Surety.

The Mortgagor is the owner of the property used as security for the loan.

To make things easy, let us focus on the traditional mortgage relationship. When you as a lender find yourself not meeting up with performing your own part of the mortgage agreement by repaying the loan, you honestly want to repay the loan and not just buy some time or frustrate the lender, then there is hope for you, even when the mortgagee has taken steps to approach the court.

WHAT YOU CAN DO WHEN YOU DEFAULT IN PAYMENT?.

1. GET ORGANIZED.

If you are already behind schedule as regards the repayment plan encapsulated in the mortgage agreement and the mortgagee has taken legal steps to enforce the contract, do not worry too much as all hope is not lost. You just have to organize yourself. Do not avoid the lender's calls, letters or emails. Respond to them promptly and tell your story. Your legal adviser can do this as he knows how well to sell your story and avoid clauses and phrases that might communicate the wrong message or be used against you during legal proceedings in court.

A swift response radiates a positive attitude to the problem, as it assures the mortgagee that you are willing to corporate with them and reach an amicable resolution. No lender enjoys litigation in court or taking unpleasant action against a customer except they have no choice. If you have been avoiding their emails and calls, return their calls or and explain why you have been lagging behind.

2. ORGANIZE YOUR FINANCIAL INFORMATION.

Here you have to put together how much you earn monthly and try as much as possible to reduce your re-occurring expenses. The pandemic rocking the world is affecting everything and not just you. So do not simply relax and hope the excuse of FORCE MAJEURE or COVID-19 will work magic and pulverize your financial liabilities.

Some employee received pay cuts, some lost their source of income, whereas others lost some source of income. You need to calculate how much you are worth monthly to make things work. This will help you to renegotiate your repayment plan as it will serve as evidence of your willingness to repay the loan.

3. REVIEW YOUR BUDGET.

When you earn enough, you also have to spend wisely especially when you are in debt. You have to go over your budget and do away with things that are not necessary. Get only your essentials because there is a loan to be paid. You don't want to lose that property of yours because of extravagant expenses, do you?

A write said' the problem of an average Nigerian is not lack of resources, but lack of resourcefulness. So, revert to the parable of the single talent, try as much as possible to multiply it and not bury it using the FORCE MAJEURE or COVID-19. The court has ruled that it won't avail much, especially if you were culpable.

4. LEARN ABOUT YOUR RIGHTS.

Some loans guaranteed by the remuneration for salaries and accruable are sometimes insured and you can cash your insurance to repay the loan or any part thereof in the event that you lose your job.

As a borrow, you have some rights both under the law and in the agreement you executed with the lender. Often times, the demand letter sent to you has an option for you, other than invoking the law against you or proceeding to sell the property by the lender. Take out the document, study it carefully as it contains what happens when there is a default in payment, as to whether there will be additional interest rate or a penalty and how to navigate these murky waters.

However, you might need help in interpreting the content of the agreement and the implications thereof. So, it is advisable to consult a legal adviser and if need be, a forensic accountant to determine if the outstanding balance is ladened with excess charges. Some of these banks dey load excess charges join your debts. You go just begin wonder how 10 million naira loan jump to 30million naira in just 3-4 years.


5. LOAN MODIFICATION STRATEGY.

The essence of this is to mitigate loss. It can either be for an extension of time within which to repay the loan(deferment of loan repayment) or to reduce the interest rate in line with the present reality of things. You can also request that your loan be restructured in such a way that the bank will give you an additional facility to resurrect your business.

You can also request that an additional facility be given to you if the mortgaged property can still accommodate additional risk.

6. RENEGOTIATION.

Most lenders will rather go for a realistic alternative dispute resolution than the cumbersome court process of debt recovery or sourcing for buyers to dispose of the property. You will rather elect this option to avoid extra expenses and time wastage. This is because the lender is not under an obligation to sell the property at the best price or at your price.

They are after recovering their money and not making a profit from the sale. So they can sell at a price lower than your expectation. Most loan agreements come with a clause which provides that you will pay all legal expenses they incur in the event that you fail to repay the loan as and when due, if they have to sue to recover the principal sum and interest. You don't want more debt added to your existing debt, do you?
Sometimes the borrower might lack the basic skills of a professional negotiator, so you need a professional to help you put out your terms of modification of the loan before the lender.

7. LEASE THE PROPERTY.

You can lease the property if there is a clause under the mortgage agreement that doesn't stop you from doing so. This is possible where the property is relatively big. You can lease a part of it and use the money to settle some of your indebtedness. What are you doing with all that space if it is accumulating interest to your existing debt? Remember when leasing, do not add all your problems to the rent, give it a fair price. However where the mortgage agreement bars you from leasing the property, renegotiate with the lender to either lease a part of the property by yourself, or they should lease it whichever works fine for you both.

8. REOPENING OF FORECLOSURE ABSOLUTE.

You can also redeem your property if the case is already in court and a foreclosure order has been made against you. However, there are some conditions you must fulfill before the court can avail you the opportunity to redeem.

9. GET HELP.

You want to contest your interest rate or get an opportunity to redeem your property? Then you need a professional to represent and direct you on what to do. They will explain your legal and equitable right better to you. They can also negotiate on your behalf for better terms. Or you do not want to talk with the lender physically but need someone to represent your interest? Then get help, and not just any help, but a help worth asking for.

Remember, do not wait until the last minute to seek help ( equity aids the vigilant) the earlier the better. Once there is a default on your part, get help.