If you often find yourself saying “I’m having Difficulty Paying My Mortgage Payments” or “are already behind on payments”, you can take steps to keep your house.
1. Consult with an experienced advisor
You should consider seeking independent financial counsel before making any mortgage decisions. A Citizens Advice Bureau can also assist you.
2. Determine your financial capabilities
Before you contact your lender, determine how much you can afford to pay toward your mortgage.
If you have mortgage debt, you’ll need to talk to your lender about how you’ll deal with it and how you’ll afford the monthly mortgage payments.
You may use our budgeting calculator to figure out how much money is coming in and going out.
3. Consult with your lender
If you’re having trouble making your mortgage payments, you should contact your lender as soon as possible.
They’ll usually contact you within 15 days of a missed payment, but you shouldn’t wait that long.
If your income has dropped due to an unforeseen event.
Your lender should understand if your household income has decreased due to occurrences such as:
- A job loss in the family, such as if you were laid off;
- An sickness or accident; or
- A death.
Several lenders have specialized support teams that can explain their possibilities.
If you are unable to repay a second mortgage or secured debt,
If you’re having Difficulty Paying My Mortgage Payments on a second mortgage or any loan that uses your home as collateral, you should get help from an experienced debt consultant. A Citizens Advice Bureau can help you.
If you have arrears, lenders who offer you this form of loan must follow strict rules. The Financial Conduct Authority website explains these rules in detail.
What your lender might provide you with?
Lenders are required to treat you fairly and to take into account any request you make to change the way you pay your mortgage.
Depending on your circumstances, your lender may give you the choice to:
- Alter when you pay – You may be able to stop making mortgage payments.
- Pay back what you owe later – You could have what you owe increased to the capital outstanding on the mortgage. This is known as ‘capitalizing the arrears.’
- Reduce the amount you pay for a short period of time – You may be able to pay less towards your mortgage for the next few months
- Repay your mortgage over a longer period of time – This is known as extending the mortgage term
- Reduce your monthly interest payments – If you have equity in your property, you may be able to negotiate a lower interest rate
- Make interest-only payments – You just pay the interest on what you borrow each month.
- Move to a lower mortgage – You may be able to cut your payments by switching to a fixed-rate mortgage.
How to Make a Loan Offer to a Bank
After getting advice on your options and determining your budget, you should submit an offer letter to your lender.
- The reason you’re having trouble making your mortgage payments.
- How much money you can afford to pay each month.
- If the lender hasn’t already given a more flexible payment option, explain how your offer can cover both the arrears and the continued mortgage payments.
- A review period built in; and
- A copy of your home budget.
If you obtained your mortgage after October 31, 2004, your mortgage lender is required to follow Financial Conduct Authority (FCA) standards when dealing with mortgage arrears.
Your mortgage lender must treat you fairly and provide you a reasonable opportunity to make plans to pay off the arrears if you are able, according to the guidelines. Every reasonable request from you to adjust when or how you pay your mortgage must be considered. If you took out a mortgage before October 2004, your lender must follow the code in effect at the time.
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