Falling behind with your mortgage payments can be a very worrying time, but, according to a City regulatory, you shouldn’t be going through it alone.
A review by the Financial Conduct Authority (FCA) into how mortgage lenders handle the cases of people in arrears has found lenders could be doing more to help those struggling.
They realised some lenders have “one size fits all” systems, making it hard for both staff and customers to find a suitable solution.
The FCA therefore wants lenders to show more flexibility, ensuring all their customers are treated fairly.
As the economy continues to show signs of picking up, the need for this change will become even greater, too.
Because although good news in many ways, a healthier financial market could also mean rising interest rates - from the historic 0.5% low of the last five years - and people on tracker mortgages somehow having to find extra money every month.
A recent report for Barclays Mortgages suggested that if the bank rate edge up “moderately” to around 1.25% by November next year, we could expect to see around £252 added to our yearly mortgage payments.
To pre-empt problems, the FCA wants lenders to proactively identify borrowers who may find a rise in interest rates particularly tough - and have plans in place for how they can be helped.
Certainly, without this support, the temptation to ignore your problems and just bury your head in the sand is huge - for example, charities have recently reported seeing some struggling borrowers resorting to trying to cover the costs with high-interest payday loans.
To avoid getting caught in the same trap, it’s important you speak to your lender at the earliest chance you get.
They may be able to help you work something out - such as changing the way you pay your mortgage bill every month.
It’s also well worth reading through your financial paperwork and checking with your mortgage lender to see if you have insurance which can help you with your mortgage payments if you’ve lost your job, had an accident or become ill.