Facing Financial Difficulty
Please don’t ignore the problem
If you are having trouble paying your mortgage, there are a number of options available that may ease your situation and ultimately help to resolve the issue. This section explains the things that you should consider and the actions that we will take to help you.
Call us on the appropriate phone number below as soon as possible if you are having problems paying your mortgage or think that you may experience difficulty doing so in the near future:
You’ll need to quote your mortgage account number whenever you have a mortgage query. This can be found on your mortgage statement or other mortgage related letters.
You could lose your home if you don't keep up your mortgage repayments
Steps you should take
- If you are struggling with your financial commitments, you should pay all your essential bills first, such as your mortgage, utility bills (electricity, gas, water), insurances, council tax and housekeeping. You should ensure that you pay these essential bills before making any payments towards credit cards or loans.
- Check whether you can get any state benefits or tax credits which could help to increase your income. You can find information about what benefits you may be entitled from the Money Advice Service. This website provides free and impartial money advice, set up by the government.
- Depending on where you live in the UK, there are government schemes that offer help if you can’t pay your mortgage. One example is Support for Mortgage Interest. If you receive certain benefits you may be able to get help towards your mortgage interest payments. You can get further information about government schemes from the Money Advice Service.
- If you have an insurance policy, such as income protection insurance, check whether this could help with your payments.
- Seek debt advice from Citizens Advice, Step Change, or any of the organisations listed under 'Useful Links' if you would like help with managing your finances.
- Make sure you keep all joint mortgage holders, and anyone acting as a guarantor on the mortgage, up to date with what is happening.
- Get back to us quickly if we try to contact you to discuss your mortgage.
How we can help
If you’ve fallen behind with your payments, we will do the following.
- Attempt to contact you as soon as possible to discuss your circumstances.
- Give you a reasonable period of time to pay back the arrears. We understand that if you are experiencing financial difficulties you may not be able to pay all your arrears in one go and this may make your situation worse. If you think this is the case, please call us as soon as possible. We will try to arrange a repayment plan that meets your needs and financial circumstances. Having your income and expenditure to hand, including payments to any other companies you owe money, will save time and help us fully understand your situation.
- Talk to an agency which gives debt advice, for example Citizens Advice, Step Change, or any of the organisations listed under 'Useful Links' if you would like us to.
- Offer to send a debt counsellor to see you to discuss your financial circumstances. There is a fee, but the cost of the visit may be added to your mortgage account.
- Offer to change the method by which you make your payments or the date on which you make them.
- See whether we can allow you to pay back your mortgage over a longer period of time to reduce your monthly payments.
If we cannot offer you any of the options above, we will tell you why. If we are able to offer one or more of them, we will explain how each option would work and give you time to consider it.
You may wish to talk to a professional adviser, such as a debt counsellor or a lawyer, before you change your mortgage arrangements. We would strongly advise that you seek independent, free, debt advice.
Costs, charges and legal proceedings
Costs and charges
If your mortgage goes into arrears, we may charge you for reasonable administration and, more importantly, legal costs. We will tell you the amount you will have to pay – contact us.
If we cannot agree on a solution with you to clear your arrears, we may go to court to start proceedings to repossess your home. If proceedings take place, it is strongly recommended that you attend the court and that you seek independent debt and legal advice.
The commencement of court proceedings does not necessarily mean that we will repossess your home. We will keep trying to solve the problem with you. Repossession is a last resort.
If we have started court proceedings to repossess your home, you should get in touch with your local authority to see if you are eligible for assistance in finding somewhere else to live. We’ll send you some information about this.
If your home is repossessed
If your home is eventually repossessed:
- We will sell it for the best price we can reasonably achieve. We will try to sell it as soon as possible.
- We will give you reasonable time to take your possessions from your home.
- We will use the money raised from selling your home to pay all loans and charges secured by your mortgage.
- If there is any money left over, we will pay it to you.
- If there is not enough money from the sale to pay off the entire mortgage, you will still owe us the amount that is left over (a shortfall debt). We will tell you what this is as soon as possible.
- If you bought your home with other borrowers, each of you will be responsible for all the money borrowed. This is true even if you normally only pay part of the mortgage.
- We will take account of your income and outgoings when trying to arrange a suitable payment plan for this shortfall debt with you.
- If we cannot arrange a plan, we may go to court to recover the money, and you might have to pay additional court costs.
- If a shortfall debt is not paid, it could affect whether you are able to get credit in future.
Dealing with complaints
If you think that we have not treated you fairly in dealing with any arrears on your mortgage, first please talk to us and let us know what the problem is. The chances are that your complaint can be quickly resolved by the manager of the area you are dealing with – so please contact them first. Find details of your local branch.
If, after going through the complaints process, you’re still unhappy, you can then refer your complaint to the Financial Ombudsman Service (The Financial Ombudsman Service is only available once you have received the final letter of response from us, or if you have not received a final response after 8 weeks). The Financial Ombudsman Service provides a free and independent service for consumers, and can be contacted at:
The Financial Ombudsman Service
London E14 9SR
FOS Enquiries & Consumer Helpline:
Monday to Friday - 8am to 8pm
Saturday - 9am to 1pm
- 0800 023 4 567: Calls to this number are now free on mobile phones and landlines
- 0300 123 9 123: Calls to this number cost no more than calls to 01 and 02 numbers.
Some companies may offer you new loans or even invite you to sell your property to them and then lease it back as a way of resolving your short-term financial difficulty. Please be careful, as such actions may not be in your long-term best interests. We advise you to seek independent advice before entering into any arrangement of this type.
You may be thinking about handing your keys over to us. If you do this, you will still owe us any outstanding debt, and we advise you to discuss this option with us first before taking such action.