Mortgage payment problems - further information

The following information and guidance will help if you are having trouble making your mortgage payments, or if you can see a problem arising in the future.

Your credit rating – how underpayments and missed payments can affect your credit rating
Leaseholder and shared owner charges – information on problems paying charges in relation to leasehold and shared ownership properties
Debt and money management – contact details for debt advice agencies and other organisations if you're having trouble managing your money
Repossession and legal action – what happens if we do start legal proceedings?
Complaints

We are here to help and will always discuss your circumstances with sensitivity and positivity. The sooner you get in touch, the quicker we can help you, and you may be able to avoid bigger problems in the future.

Your credit rating

We report to credit reference agencies if you have missed a monthly payment, or any financial arrangement we organise with you. If you miss a payment or have underpaid to the value of one month’s missed payment, it will be reported to credit reference agencies at the end of the calendar month.

This means that you have the rest of the month to make up the payment without it being reported. Other lenders do have access to your credit rating, so this may affect your borrowing in the future.

Leaseholder and shared owner charges

If you have a leasehold or shared ownership property, you will have to pay other charges in relation to your property, which take the same priority as your mortgage payments. These include:

Service charges – paid to your housing association / management company for the services they provide. This can include the cleaning of your communal arrears, general maintenance and repairs to the building.
Ground rent – this is the payment you make to the freeholder of the land on which your property is on.
Rent – if you are a shared owner, you pay your housing association rent for the part of the property they own.

These are paid directly to your housing association, freeholder or management company, whichever is appropriate.

If you think you will struggle to make these payments, or if you have failed to pay them previously, you should contact your housing association as soon as possible. You may be able to work out an arrangement to become up to date with your payments. If you fail to contact your housing association, freeholder or management company, they will contact us as your mortgage provider to pay the shortfall on your rent/service charges. To prevent forfeiture of the lease and safeguard our security on the property, we will pay the amount needed to bring your account with them up to date on your behalf.

This incurs extra costs to you. We will add the rent payment to your mortgage account, along with administrative fees. Because the rent arrears payment is added to your mortgage account, it starts incurring daily interest on top of your mortgage, making it more expensive in the long run.

Whilst we will contact you and try to organise an arrangement (alongside your mortgage payments) to bring your account up to date, it is always better to see if you can make a payment plan directly with your housing association. It is important to talk to them to see what they can do to help, rather than rely on your mortgage provider to make the payments for you.

Debt and money management

Put together by the Money and Pensions Service, we’ve partnered with Money Helper which helps provide advice on personal debt and will link you with an available debt adviser from one of their partner organisations.
Stepchange (0800 138 111 and online webchat) – a charity providing free, confidential and expert advice on personal debts (please note, they are not suitable if you are self-employed)
Business Debtline (0800 197 6026 and online webchat) – if you’re self-employed this charity provides free, independent, and expert advice

Benefit maximalisation

Turn2Us – a free service to help you check you’re receiving all the benefits you can, and also have a grants search for further funds to help
Entitledto – a free service aiming to make benefits easier to understand with a benefits calculator and budget planner.

Mental health

Mind (0300 123 3393) – a charity providing support and information for those living with ill mental health
Mental Health & Money Advice – a online advice service designed to help people understand, manage, and improve mental health and finances.

Support in difficult times

Citizens Advice Bureau – a nationwide charity with local centres who provide support for problems including money, debt, housing, family, and law and courts
GamCare (with online webchat) – the leading provider of information, advice, and support for anyone affected by gambling harms. They can provide support and treatment for anyone affected by gambling
Gingerbread - a national charity who work to support single-parent families
Refuge (with online webchat at certain times) – a charity providing confidential support for women who are victims of domestic abuse
Respect (with online webchat at certain times) – a charity providing confidential support for men who are victims of domestic abuse.

You can also view our own Cost of Living Support hub, which has plenty of useful tips, articles, and resources to help with rising prices.

Repossession and legal action

If we cannot agree on a solution or if you fail to maintain your arrangement with us, we may have no other option but to start legal action. Repossession is always a last resort, and we will always try to come to an arrangement with you to get your mortgage back on track. However, if all options have been exhausted, we will:

We will inform you in good time that we intend to proceed with legal action, and give you the opportunity to make your account up to date
We encourage you to attend court and take independent debt advice
Repossession may not necessarily happen. We will continue to find a solution with you, and repossession is always the last resort
If repossession does happen, we encourage you to get in touch with your local authority to see if they can help you find a new place to live.

If we do repossess your home:

We will sell it for the best price we can reasonably get, and try to sell it as quickly as possible
We will give you time to take your possessions from your home
Any money left over from the sale will be passed on to you.

It may be possible that the sale of your home does not cover the amount needed to pay off your mortgage – a shortfall. If this happens:

We will let you know as soon as possible so that we can organise a way for you to pay it back
Every borrower is liable for the shortfall – even if you only paid part of the mortgage
We will take into consideration your income and expenditure to organise a payment plan
Details of any unpaid shortfall will be passed on to credit reference agencies so may affect your borrowing in the future.

The Housing Loss Prevention Advice Service

The Housing Loss Prevention Advice Service (HLPAS) is a new government funded scheme which provides free early legal advice on housing and debt to those who are at risk of repossession proceedings and/or losing their home. You can find your nearest HLPAS provider on the government's 'find a legal aid adviser' webpage.

Other things to consider

There are some companies that may offer you new loans or invite you to sell your property to them and lease it back to you as a way to solve your financial problems. There are also companies who offer to help create a budget and organise your finances, for a fee. Please be careful, as these may not be in your best interests. You can always receive free independent advice before entering into any arrangement that is proposed to you.

You may also consider handing over your keys to us. Please consider this option thoroughly, as you will still have to pay your monthly mortgage payments until the property is sold and it may affect your ability to secure local authority housing. If the property is sold for less than what you owe, you will still have to pay the shortfall.

Complaints

If you believe that we have not treated you fairly, you have the right to complain.

You can visit our customer satisfaction page for details on how to contact us. If you believe your complaint has not been dealt with adequately, you may be able to refer it to the Financial Ombudsman, who can be contacted at:

The Financial Ombudsman Service
Exchange Tower
London
E14 9SR

Tel: 0800 0234567

Please remember it is always better to contact us as soon as you realise you may be having trouble paying your mortgage. We are here to help and want to arrange with you a plan of action to help you stay on track with your mortgage.

Return to main mortgage payment page.

Information correct as of 25th November 2022.

YOUR MORTGAGE IS SECURED ON YOUR HOME. THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.