28 Feb What happens if I can’t pay my mortgage?

The current cost of living crisis, as well as a spike in mortgage rates, has meant that thousands of people in the UK are feeling the pinch. And, if you’re one of those people, it can be scary when bills begin to mount up including monthly mortgage payments. Don’t worry though as there are steps that you can take to avoid losing your home. Here, we answer the question: What happens if I can’t pay my mortgage?

Talk to someone

First things first, and before you make any big decisions, it’s wise to get some advice from an experienced advisor. At Kaytons, we work with a leading mortgage advisor who we recommend to our customers. Together, they will help you to work out exactly what you can afford as well as making a plan going forward. If you’d like us to put you in touch with them, simply drop us a message. 

Tell your lender

It’s also important that you keep your mortgage lender informed if you’re struggling with any payments. Many lenders even have specialist teams and processes in the event that your income has fallen because of something unexpected. While it might seem daunting, there are a few different options available. Your mortgage lender might allow you to:

• Change when you pay
• Repay what you owe later
• Reduce your mortgage payments for a while
• Repay your mortgage over a longer period of time
• Reduce your monthly interest payments 
• Change to interest-only payments
• Switch to a cheaper mortgage 

Check your insurance 

When you took your mortgage out, you may also have taken out mortgage payment protection insurance. This isn’t always with the same company as your mortgage lender though. If you do have a policy, you could be protected if you’ve lost your job or your income has changed suddenly. 

Try to reduce your costs and increase your income

If you are struggling to pay your mortgage, then reducing your expenditure in other areas of your life could help. Reduce your day-to-day expenses, see if you can get cheaper buildings or contents insurance, and see if you can get a cheaper deal for things like internet and mobile phones. Increasing your income isn’t always easy but see if you can sell some belongings you don’t use to make extra cash or you could even consider renting out a spare room or car park space. You might even be eligible for certain benefits – depending on your situation. 

Consider selling your home

Another option if you’re struggling to pay your mortgage would be to sell your home – but you shouldn’t make this decision without speaking to a professional first. As mentioned above, we can recommend a mortgage advisor who can help you to weigh up your options. Plus, at Kaytons, if you do decide to sell your home and downsize, our team of property experts can guide you through the process.

The most important thing to remember is that if you are struggling, there are options. Before making a decision, or doing anything drastic, be sure to speak to someone and remember there is a way out.