Your mortgage is secured on your home, so it’s one of your most important priority debts. FCA rules require lenders to work with customers in difficulty before taking repossession action.
The short answer
- Mortgage arrears are a priority debt.
- Lenders must consider options such as payment plans, term extensions or switching to interest-only temporarily.
- Repossession should be a last resort and needs a court order.
- The Mortgage Charter gives extra options with many lenders.
- Mortgages can’t be included in an IVA or DMP, but freeing up money from other debts can help.
What should I do first?
- Call your lender, explain what’s happened and ask what options they offer.
- Prepare a budget showing what you can pay.
- Check whether you can get Support for Mortgage Interest, a government loan for some people on benefits.
- Keep paying what you can. Even part payments help.
What can my lender offer?
Options can include an arrangement to pay the arrears over time, extending your mortgage term, a temporary switch to interest-only, or adding the arrears to the balance. Many lenders signed up to the Mortgage Charter, which offers some of these options without affecting your credit score in certain circumstances.
How can a debt solution help?
An IVA or debt management plan can reduce what you pay to unsecured creditors, freeing money for your mortgage. Your mortgage stays outside the IVA. See will I lose my house in an IVA?
For repossession figures by area, see our mortgage arrears and repossession statistics.
Common questions
How many missed mortgage payments before repossession?
There’s no fixed number. Lenders must give you a reasonable chance to catch up. Lenders that signed the Mortgage Charter have agreed not to force repossession within 12 months of the first missed payment, except in exceptional circumstances.
Can I get an IVA with mortgage arrears?
Yes, but the mortgage and its arrears stay outside the IVA. You must be able to keep up your mortgage and make IVA payments.
Will my lender report arrears to credit reference agencies?
Usually, yes. Missed payments are typically recorded on your credit file.
Getting help
You don’t have to deal with debt on your own. Free, impartial advice is available from MoneyHelper, StepChange and National Debtline. If you want to talk through whether a formal solution such as an IVA could be suitable, you can also get in touch with us.