Summary: this article looks at ways an individual can lower their monthly mortgage repayment to more manageable amounts.
Anyone who is struggling to repay their mortgage should immediately contact their lender. It is possible that an arrangement could be made resulting in lower monthly repayments, or even a payment holiday in extreme circumstances. It is also vital that no matter how small the amount, regular repayments should be kept.
I'm struggling with my mortgage, before I speak to the lender, what can I do?
If an individual is concerned that they may fall behind with their repayments, there are a few actions they could take to help lower the amount.
Switch to a cheaper mortgage. It may be possible to find a cheaper deal with a different lender. It is important to remember that there may be a fee to pay to the original lender if coming out of the mortgage early, and any arrears that are owed will also need to be repaid in full. There are many comparison websites available that can help find the best deal, but it is important to fully research the options available.
Discussing lowering the mortgage repayments with the existing lender. As mentioned above, it is important to discuss any concerns with the existing lender before taking any action. They may be able to reduce the monthly repayments by increasing the overall length of the mortgage. The individual should always check if there are any fees associated with changing the mortgage in this way.
Reducing payments into an endowment policy. It may be possible to reduce or stop payments into a endowment policy if it is an endowment mortgage. It is important to remember that if payments are stopped they will need to be made up at a later date. It is vital that for this option, independent financial advice is sought BEFORE making any decisions.
Reducing repayments where the mortgage is shared ownership. It may be possible to sell back some of the property to the landlord, thereby reducing the overall mortgage. This may not be possible in all instances, so it is important the individual contacts the landlord for further information and advice.
(Information sourced from adviceguide.org.uk )