If you are facing financial problems and you are a homeowner, you must take urgent measures to protect your home from repossession. However, not all situations require the same reactions. The UK government has created several programs and rescue plans that adapt to your personal circumstances. In our last article we divided repossession circumstances into four scenarios:

Program 1. You are struggling to pay your mortgage. You still haven’t fallen behind in your payments, but you fear you may soon.

Program 2. You have missed some mortgage payments. Your lender still hasn’t threatened with repossession, but you fear he might soon.

Program 3. Your lender is threatening with repossession.

Program 4. You have received papers requesting you to go to court.

In our last article we already set out a plan for homeowners in the first scenario. This article focuses on what to do if you have missed some mortgage payments.

First Step: Take the initiative. Now is not the time to play the victim. Take control of the situation and use the tools at your disposal to find a long term solution to your financial problems.

Second Step: Get prepared. Now you have already missed some payments, time is really of the essence and you need to be prepared before you meet with potential lenders or government agency officers. Getting prepared means preparing a detailed budget that includes your income and fixed expenses. It also means assessing what options are available to you. The best way to find this out is to contact an independent advice agency. Click here for a list of advice agencies.

Third Step: Find out what government programs are available. Usually borrowers are encouraged to contact their lenders first, but you are already behind in your payments and need to fast-track things a little. Click here for a list of UK government housing programs. These include SMI, support for mortgage interest, and HMS, homeowners mortgage support.

Fourth Step: Talk to your lender. Do this as fast as possible. You may be surprised out how empathetic they are, and empathy aside, lenders know they are required by law to show a willingness to find an alternative solution to repossession before they go to court. This requirement is set by the pre-action protocol law on lenders. Be honest to them. Present all the facts clearly. They can only help you if you provide an honest assessment of the situation.  Your options include changing the terms of your loan, reduce payments in the short term until you get back on to your feet or add the money you owe in mortgage payments to the balance of your mortgage, among other possibilities.

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