In order to clear your mortgage arrears, you will have to offer an additional payment to clear the arrears. Your mortgage lender may expect you to clear your arrears over one of two years, but this is dependant on the amount of mortgage arrears that you have and the length of time which is left on your mortgage.
If you cannot afford to pay the arrears in the way which your mortgage lender is asking for, then see if the agreement terms can be amended and fully explain the reason why you cannot afford it, such as long-term illness or birth of a child. There is no point agreeing to something that you cannot afford or else you are more likely to miss payments and face repossession.
There are a number of methods which could clear your mortgage arrears, these include:
Stay in Contact with your Lender – The most important step is to stay in contact with your mortgage lender. It is essential that you speak to them about your mortgage arrears and ensure that they know that you are willing to work with them and get your payments back under control.
Adding the Arrears to your Mortgage – This is known as 'capitalising' the arrears, and adds the arrears to your total mortgage. This may mean that your monthly payments increase to take account of this addition. This method is only really used if the total value of your home is much greater than the mortgage owed on it.
Increasing the Mortgage Term – Most mortgages are over a standard 25 year period. If you have had your mortgage for several years then you could ask for your mortgage lender to extend your term back to 25 years in order to cut your monthly payments, so that you can afford your mortgage arrears. However, this may not be possible if you have an endowment mortgage so speak to your mortgage lender to see if this is an option for you.
Increasing your Income – If you know that you cannot afford to make your mortgage payments or you are struggling to clear your mortgage arrears, then you may need to increase your income in some way. There are a number of ways that you could do this, such as taking in a tenant, check that you have all the benefits that you are entitled to and see if you can get a second job, even if it is just a temporary measure until you have paid off your mortgage arrears.
Deal with your Debt – Perhaps one of the reasons why you have fallen into mortgage arrears is because of the amount that you are paying towards your unsecured creditors. If you feel as though making these payments is a struggle on top of your mortgage, then we can help. We could reduce the amount that you pay to your unsecured creditors, allowing you a higher level of disposable income to pay back the arrears and ensure that you do not miss any further payments to your mortgage.
To find out how we can help, contact the UKRepossessionHelpline.org on 0800 048 1779 or fill out the Quick Enquiry Form for a free callback.
Stopping a planned repossession is a complex legal process. There cannot be any guarantees of success. It is NEVER too late to start to oppose the repossession and the sooner you start the better the chance of a successful outcome. To successfully oppose repossession in Court we would always recommend professional legal representation to present your case.