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What if I can't afford my mortgage?

Many people find that because their mortgage is high or their income has fallen they can't pay the monthly instalments. If you are in this situation:

  • explain the problem to your lenders
  • pay what you can afford
  • look for ways to increase your income (see Maximising your income).

If this still doesn't help, you could also consider:

Tip: If you give up or sell your home and ask your council to re-house you they will probably say that you have made yourself 'intentionally homeless' and so refuse to offer you anywhere to live. Get expert advice from a local advice agency or from National Debtline before you do this.

Handing back the keys
If you give your home back to your lenders you will still be charged monthly instalments on the mortgage. If you do not pay, the instalments will be added to the debt when the house is sold. Extra interest can also be added on to the arrears figure. The monthly instalments will only stop being added when your lenders sell your home. This could take a long time. The lender will probably add solicitors' and estate agents' fees and any court costs on to the bill.
Selling your home
If you are thinking of selling your home you need to think about where you will live.
  • Can you sell your home and buy a smaller property?
  • Look at renting from a housing association as an option.
  • Private renting may be an option but you need to be careful about the type of tenancy you are offered and how high the rent is. Sometimes if you claim Housing Benefit your Council can decide that your rent is too high and restrict the amount of rebate they will pay you.
  • You may have friends or family that you can live with, at least temporarily.

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