Most of us have been there at some point in our life, the recession and the raise of interest rates have meant that financial difficulty has been an issue across the UK. There is hope as positive news talks about the drop in house prices and the latest government schemes set up to get the market buoyant again.
But what about if you are having trouble paying your monthly mortgage payments? There’s nothing scarier than the thought of losing your home. Burying your head in the sand will only make things worse. The first thing you need to do is contact your lender, you will be surprised how helpful they will be. Provide them with a detailed proposal on what you can afford to pay and you should be on your way to reaching an agreement.
Most lenders will go through a detailed financial analysis of all your income and outgoings, repossession of your property is a last resort, after considering repayment holidays or extending the term or type of mortgage that you have.
A string of initiatives have been set up to try and assist people and help them to keep their homes. Some enable not-for-profit housing associations to buy your home and then allow you to still live there.
In England and Wales this is called the Mortgage Rescue Scheme and is run by local authorities. Wherever you live in the UK, you will be able to seek free, independent advice to discuss what will work best for you.
The housing charity Shelter provides specific help and advice for homeowners in England, in Scotland and in Wales. To seek advice from mortgage providers, check the Council of Mortgage Lenders’ guide.
Another initiative, the Homeowner Mortgage Support Scheme, allows households that see their income fall unexpectedly, defer part of their payments for up to two years. Yet, only a very few lenders have said they would take part in this scheme.
In addition to this, the Support for Mortgage Interest (SMI) scheme, who help people receiving some benefits, has been expanded and operates across the UK.