If you are struggling with your mortgage repayments and in danger of losing your home, if you’re trying to bury your head in the sand trying to ignore the problem. Read on. This article may help. Speaking with industry professionals about this subject, no matter how bad you think the situation is. There may be some assistance available.
Potential steps to follow if you find yourself with mortgage arrears.
Finding the solution? Not easy but not impossible.
- Contact your lender: Your mortgage lender will be eager to help and you need to talk through our options. The lender should make efforts to reach an agreement with you by considering changing the way you make payments and when you make them. Furthermore, your lender must give you reasonable notice before taking any action. Besides, lenders could extend your mortgage term by depending on your circumstances.
- Check whether you have insurance to cover, the reason you have the mortgage arrears. It might be due to unemployment, if you can’t make the mortgage repayments because income has fallen down due to sickness, accident, or redundancy. There are insurance products that may help you to make the mortgage repayments. Look through the paperwork you used when you took out the mortgage.
- Cuts from daily Spending: Considering your spending habits divide your spending into two parts and one is essential and the second one is non-essential items. By doing that you can see where you can save cash. Must stop all the non-essential items such as if you have gym or magazine subscriptions and you are not getting value from them then cancel these. Again, cut all other smaller non-essentials items. For instance, take-away coffees or drinks after work besides avoiding these it will help to keep you healthy.
- Consulting to a Free Debt Counselling Service: Another way to get advice from one of the many free debt charities and organisations. An independent agency like Citizens Advice or Shelter can provide free advice. There are certain charities that can help you and provide information about how you can find the solutions.
Things To Be Aware Of
Always try to consult free debt advice instead of taking any of the following options. They will help and give more ideas and solutions.
- Paying debt by taking on more debt is never a good idea. These loans could be quite costly and are often secured on your home by putting it at greater risk. It may also put you at greater risk of the property being repossessed, because there is another creditor chasing you for the debt.
- By returning the keys – Selling your home wouldn’t be enough to pay the debts if the money is raised. It doesn’t matter if you sold it or not, you will still be responsible for the mortgage repayments. It doesn’t matter if you simply hand the keys back as the debt will just follow you.
- Trying to sell the home without thinking where to live –This may be your only viable option. Assuming that the property sold for more than you owe, it really could be a solution. However, you will then need a new place to live.
- Sale/ Rent – back and forth – In this type of situation you sell your home and again rent it back from the company where you sold it. The FCA has stopped several schemes because they treated clients unfairly. It is better to be aware of this at all if tempted to talk to a debt counselling service first.
Work out a plan
In certain cases, it will be noticeable for the reasons you have a problem. Or maybe your earnings and expenses might have changed abruptly. For instance, you lost your income, due to unemployment, accident or sickness or your roommate or partner moved out and stopped contributing towards the mortgage. It will have a detrimental affect on your ability to maintain your mortgage payments it could also mean that you are living beyond your means. Either way, you’ll need a plan to overcome the other extra expenses.
A point to remember that if you are repeatedly late with your mortgage payments then it could lead you to your lender repossessing your property, leaving you homeless. It also means that if you ever wanted to get another mortgage, it would be very difficult to do so. You may have to supply a much larger deposit as a result. So, with that in mind it will probably mean that you are going to have to rent a home for the foreseeable future. A landlord may also want you to pay a higher than usual deposit or rent because of your past issues in maintaining your credit commitments. A deposit would normally be held by your landlord but nowadays it should be held by an agent and would form part of the deposit guarantee scheme.
Steps of success
Budget planning is so important. Yes, try to use a budget planner to sort out what is basic income, disposable income and income you need for essential expenses such as rent, food and clothing. Basically, a budget planner will help you to record what you have earned and what you have spent. Note down the important expenses such as household bills, living costs, finance & insurance, family & friends, travel, and leisure, etc. At the end of the month use a calculator to breakdown your expenses.
Now have a glance at ways you can take back or increase the monthly earning to fill up the gaps. However, if it’s expected to be a long-term problem, then getting immediate help could be the best solution before it gets out of control.
Want to learn more about Mortgage Arrears and how this could affect your ability to obtain finance in the future? If the answer is yes? Then you could consider calling or visiting Independent Mortgage Brokers based in Halifax, Yorkshire you could be eligible for free mortgage advice free online mortgage advice. They have specialist mortgage brokers available to advise and guide you through obtaining mortgages if you have had mortgage arrears in the past. Mortgage Arrears are undoubtedly an issue when you are looking for a new mortgage but what you may not know is how to overcome the problem Working with Independent Mortgage Brokers based in Halifax who are rated excellent on Trustpilot, they will help you formulate a proper plan and make you aware of important facts which will help shed light on your issues with Mortgage Arrears and how to resolve them.