If you have mortgage arrears it means you are behind the monthly mortgage payments and if you don’t pay what you owe, you are at the risk of your house being repossessed. The lenders can also apply charges for being behind called Arrears Fee/Charges. The charges are meant to cover the lender’s costs of managing the account while it is in arrears. When in mortgage arrears, this can very quickly slip from hands if appropriate steps are not taken at the right time.
How can we help?
First Credit Advice Limited will assist you with your mortgage arrears by making reduced and affordable repayments towards your outstanding balance of arrears. The repayments will be calculated after generating your realistic budget and disposable income thereafter.
The main features of repayment arrangement with your lender consist of;
- Freezing down interest on the outstanding balance
- Reversal of the arrear charges and late payment charges
- Lender not pursuing you for the payment of outstanding debt unless you are paying minimum Norgan Amount applicable
Adding the Arrears to Your Mortagage
This is called ‘Capitalizing’ the arrears. This can be done only if the value of your house is a lot more than the mortgage. The amount you owe in arrears is added to your total mortgage balance. Repayment of arrears is hence spread over the rest of your mortgage and your monthly mortgage payment goes up slightly. Mortgage lender is more likely to agree to capitalize the arrears if you have kept the payment updated at least for three months after incurring arrears. Capitalization of arrears is usually a last resort option.
Capitalization of mortgage arrears opens your options for switching your mortgage to a lower rate and thus bringing the monthly payments down according to the current prevailing market rate for the same loan to value principle.
We can help you capitalize your arrears and ultimately getting a rationalized rate deal from your mortgage lender which will certainly save your hard earn money in long term.