Negotiating with your lender

This topic is for you, if you are struggling to keep up repayments on a mortgage secured against the property you live in.

If you think you may fall behind with your mortgage, it is important that you talk to your lender straight away, because there are things that they can do to allow you to stay in your home. Even if you are already in arrears, you should talk to your lender. It is important to know that your lender should follow the steps outlined in the pre-action protocol for mortgage arrears cases before they consider taking you to court.

Legislation and guidance brought in in 2010 require the lender to provide certain information to the person owing money to them, and "make reasonable efforts" to agree proposals with that person, to avoid action being taken.

Lenders should only start court action to repossess your home as a last resort. They usually prefer to sort out your payment problems in other ways - this is called 'forebearance'. Examples include:

  • Allowing time to sell
  • Lengthening the term of the mortgage
  • Allowing a payment break
  • Changing the type of mortgage, for example changing it to 'Interest only'
  • Accepting an offer of repayment of arrears over an extended period of time.

In addition to these options, you should also look into Support for Mortgage Interest, or the Mortgage to Rent Scheme.

Even if the lender has already started court action, this does not mean you will have to lose your home - see the topic 'Negotiating at Court'.

For more help and guidance, we recommend you contact your local Citizens Advice Bureau: