Having your house repossessed is one of the most stressful and upsetting things which can happen to a person. Sometimes people fall behind because a lack of mortgage protection means that when they lose their jobs there is just no money to pay the lender. In other cases it may be down to bad budgeting, interest rate rises or other changes in circumstances.

On top of this, falling house prices in the UK can mean that many homeowners face negative equity, this is particularly likely for those who took up one of the 100% mortgage deal offers available before they were pulled from the market.

Since the beginning of the recession, tens of thousands of homes have been repossessed in the UK because of missed mortgage payments – statistics from the Council of Mortgage Lenders showed that 9,800 homes had been repossessed in the first quarter of 2010 alone.

In some cases, repossession is unavoidable, but in others there may be ways to prevent this worst case scenario with careful planning, organisation and an open attitude to lenders. Here are some things you can do if you fear you may not be able to keep up with your monthly mortgage payments.

Keep in touch with your lender

The classic mistake people make when they are getting behind with mortgage repayments is to bury their head in the sand and refuse to speak to their mortgage lender about issues they are facing. This is very bad idea as it sends the message to the lender that they are unwilling to discuss the problem and find a viable solution which works on both sides.

Failing to speak to the lender is more likely to lead to repossession. Read any correspondence sent to you by them carefully, and respond where required, for example if you are sent a ‘notice of default’. If you don’t respond to this type of official correspondence when asked to, the lender is likely to begin legal steps to repossess your home.

Talking to your lender directly can also make it more likely that they will help you find and alternative solution to repossession. For example, you may be able to negotiate a changed mortgage term or a reduction in monthly payments. The lender may otherwise agree to add the outstanding debt owed from late payments onto the overall loan.

Seek advice

Independent financial advice doesn’t have to cost you anything but could be the savious of your home. The Citizens Advice Bureau is an organisation which gives free independent advice on financial issues.

An advisor will also be able to tell you if there are any government schemes which might help your situation, such as the Homeowner Mortgage Support Scheme or the Mortgage Rescue Scheme, and if you are eligible for any financial support or benefits.

The National Debtline can also provide free resources to help you, as can the Consumer Credit Counselling Service and Shelter. It is also sensible to contact your local council, who may be able to support you financially and find alternative accommodation if necessary.

Author Bio: At Credit Choices you can compare mortgage protection offers online and find out about 100% mortgages. Whatever your individual mortgage needs, we can help you find the best deal.

Category: Real Estate
Keywords: mortgages,mortgage,mortgage protection,mortgage budget