Mortgage arrears are one of the most distressing debt problems that a person can face. Like rent arrears, mortgage arrears bring with them a very real risk of losing your home and often your family’s home.
Unlike rent arrears, mortgage arrears are a secured debt, and this opens up a whole range of legal options for lenders to take court action against you and repossess your home if you fail to meet your contractual obligation to make payments on time and in full.
Quick action is needed
As with rent arrears, taking quick action on your part is of prime importance. You need to provide an explanation of how the situation has arisen and agree a way forward. It may well be the case that your circumstances have suddenly changed - perhaps through you or your partner losing your job for example, or a relationship breakdown.
Whatever the reason, you need to talk to your lender and try to reach an agreement.
They may very well agree to a 3-month payment break or put you on to an interest-only mortgage for a while to give you a chance to recover your financial position so you can make full payments again. Another option that your lender might be willing to explore with you is to increase the number of years left on your mortgage, which will in turn reduce your monthly payments.
If you cannot reach an agreement with your mortgage lender, you will need to make your mortgage arrears and your mortgage repayments top priority.