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Dealing with mortgage arrears

This advice applies to England

Contact your nearest Citizens Advice immediately if:

  • you’ve been told by your lender that they’re applying to court

  • you’ve received court papers

  • you're expecting bailiffs

If you get into debt (‘in arrears’) with your mortgage payments, don’t wait for your lender to contact you.

They’ll normally write to you within 15 days of a missed payment, but you should talk to them as soon as possible.

Lenders have to treat you fairly and consider any request you make to change the way you pay your mortgage.

They can take you to court to repossess your home if you can’t agree a way to pay back what you owe. But even then, it’s not too late to try to reach an agreement with them.

Mortgage arrears are a priority debt. This means you need to pay them before debts like credit cards.

If you have more than one debt, you should read our 'get help with debt' guide - or contact your nearest Citizens Advice.

Work out what you can afford

You’ll need to tell your lender how much you can afford to pay back, so it’s a good idea to work out your budget before you call.

You can use our budgeting tool to do this, or you can talk to an adviser at your nearest Citizens Advice.

It’s also a good idea to tell your lender if you’ve been speaking to a debt adviser. This shows them you’re serious about dealing with the debt.

If you’ve got payment protection insurance, you should check if you can use it to pay the arrears on your mortgage. You might be covered if you’ve been ill or you’ve recently lost your job, for example.

Ways to pay your arrears

Your lender will discuss the different ways you can pay your mortgage arrears. If you’ve got any money left over each month after paying essential bills, you could suggest adding a little bit on top of your future monthly payments.

Example

You normally pay £400 a month for your mortgage, but last month you missed your payment.

Instead of paying what you owe in one amount, you could suggest paying it back in 4 monthly instalments of £100.

You’d add this £100 to your regular mortgage payment of £400, so for the next 4 months you’d pay your lender £500 a month.

Other ways of paying off the arrears on your mortgage

If your home is worth more than the mortgage, your lender might let you add your arrears to the total amount you owe and pay it back over the lifetime of the mortgage. This is known as ‘capitalising your arrears’.

You might also be able to pay off your arrears using your pension or an endowment policy - which is a type of life assurance.

There’s a chance you could end up paying lots of interest or even get into more debt with these options, so it’s worth talking to an adviser at your nearest Citizens Advice first.

Reduce your monthly payments

If you’re struggling to pay your mortgage every month, you could ask to:

  • pay the debt over a longer period

  • switch to interest-only payments

  • take a break from your payments for a few months - this is known as taking a ‘repayment holiday’

If you get benefits, it’s also worth checking if you’re eligible for Support for Mortgage Interest (SMI). You might be able to use SMI to pay the interest on your mortgage.

If you can’t agree a way of paying your arrears

Your lender might ask a court for a ‘possession order’. This lets them sell your home and use the money from the sale to recover the money you owe.

Your lender has to give you at least 2 weeks notice in writing before they apply to the court.

You can read more about what you can do if your lender is trying to repossess your home.

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