Almost half of those with mortgages surveyed said they felt worse off financially than they did a year ago, the study by YouGov commissioned by Go.Compare Home Insurance revealed.
It has meant a third of Brits have stopped paying into their savings as they look for additional cash to pay for essentials.
The survey comes just after Shelter, the housing and homelessness charity, found 21% of both renters and homeowners struggled to keep up with their mortgage or rental payments. And 10%, the charity said, were worried about being evicted.
It would appear the cost-of-living crisis is still very much impacting finances of many households.
If you are concerned you may struggle to make a mortgage repayment or fear you may be facing unmanageable debt, your situation may feel hopeless. But there are measures in place to support you.
Jonathan Bone, head of mortgages at online mortgage brokers Better.co.uk, explained the steps you can take and the help available.
1. Contact your lender
This is the first and most important step you should take if you fear you may miss a payment. Bone explained, if you don’t contact your lender, they will normally contact you within 15 days of a missed payment anyway so its worth taking the initiative.
Most lenders have signed up to the Mortgage Charter, which outlines exactly what they must do if a customer is struggling with repayments.
“No lender wants to repossess a home,” Bone said, “and it is only done as a last resort when it serves the borrower’s best interests.”
2. Consider your options
The lender should be able to offer you several ways to proceed. Options can include deferring a payment, taking a payment holiday, increasing your mortgage terms to reduce your monthly payments or switching to only paying interest.
Bone suggested, if you are unsure which option is most suitable, speak with a mortgage adviser.
3. Look at your budget
Check your finances and calculate how much you can realistically pay towards your mortgage each month, Bone advised.
“If you have debt, you’ll have to arrange with your lender how you are going to pay the money back that you owe and how you are going to afford mortgage payments going forward,” he said.
4. Make an offer to your lender
Once you’ve had advice on your options and know what you can afford, Bone said, you then need to write to your lender explaining why you’re struggling to make mortgage payments, what you can afford, and how this is going to cover your mortgage payments
Your mortgage lender is obliged to deal with your case fairly and give you a reasonable chance to make arrangements to pay off any outstanding debt.
If your lender won’t accept your offer, Bone said you should carry on making payments that are as much as you can afford.
If you are concerned you can also contact one of the debt charities. These include StepChange Debt Charity, National Debtline and Citizens Advice.
Contact one of our highly experienced mortgage advisors today on 0121 500 6316 to discuss your mortgage needs.
