Breeze Finance

Mortgage Arrears
 

Keeping up with your mortgage payments should be your top financial priority. If you are evicted because of payment problems (repossession), you could become homeless. This doesn't happen automatically, but the longer you delay, the more difficult it will become to control your arrears and avoid long-term debts. If you have already been threatened with repossession, get advice immediately.

Act quickly

If you fall behind on your mortgage payments, you need to take action straight away. In some cases, the problem can be solved if you act quickly. Don't wait until the debt becomes unmanageable. Many lenders charge penalty fees if you miss payments. The sooner you deal with the situation the more options you have, and the less chance that you will lose your home.

Negotiate with your lender

If you have difficulty paying your mortgage (or think that you will have, for example because you have lost your job) it's important that to talk to your lender as soon as possible. Don't be put off because you think your situation is hopeless. There is often a solution. If you haven't yet decided what to do about the problem, explain to your lender that you are going to get specialist advice about your options.

Most lenders will expect you to come up with your own plans for paying off your mortgage, rather than making suggestions as to what you should do. You need to show that you will be able to pay of any arrears you have and keep up with future payments until your mortgage is completely paid off. If you haven't worked out your options yet, it's still important to speak to your lender as soon as possible, to let them know that you are taking action to put things right.

You can either write to your lender or make an appointment to discuss your situation in person. You will need to:

produce a detailed statement of your income, spending and debts
explain any plans you have to increase your income or reduce your spending
explain what changes you would like to make to the mortgage and how the new arrangements will affect the future payments

Your lender will consider your proposal and decide whether to accept it. You may have to negotiate further. If you switch to a different mortgage, particularly if it is with a different lender, you may have to pay a redemption penalty. It may be possible to add any fees or redemption penalties to the your mortgage and pay them off over the rest of your mortgage term.

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