For a number of reasons including job loss, relationship breakdown, interest rate rises, paying other less important debts first, many people have got behind with their mortgage and secured loan payments or are struggling in one way or another to maintain them.
Maintaining payments towards your mortgage and secured loans will normally be a top priority expense as failure to do so will usually mean that your home will eventually be put at risk.
If you fall behind with your mortgage/secured loan payments and ignore the situation or cannot come to a suitable arrangement with your lender(s) then they may eventually commence possession proceedings to evict you from your home.
If you have problems paying your mortgage/secured loans, you should contact your lender(s) as soon as possible and try to reach an agreement/arrangement as this may stop them from taking legal action (see examples below)
You may wish to look at ways of increasing your income and check any benefit entitlement as a way of helping with your finances/mortgage payments etc.
A time order could be particularly useful if you have a secured loan and your creditor is threatening to repossess your home.
It can change:
Not all secured loans can be covered by a time order (see below).
Before lenders take court/possession action for arrears they usually send out letters outlining the level of arrears/missed payments etc and request that you contact them to make up the arrears. If you do not address the situation it is likely that you will receive a formal solicitors letter informing you that an application to court for possession will be/has been made. Lenders will not usually start possession proceedings until accounts are at least 3 months in arrears.
Your mortgage lender should not start court/legal action against you without following certain rules as set out by Financial Conduct Authority (FCA). The rules say that your lender must treat you fairly and give you reasonable chance to make arrangements to pay off your arrears, if you are able to. They must consider any reasonable request from you to change when or how you pay. Your lender should only start court action as a last resort.
As well as the FCA rules, your mortgage lender should follow certain other procedures before they start court/legal action. These are called a pre-action protocol.
If you are not treated fairly you may be able to complain to the Financial Ombudsman
If you do not or cannot reach an agreement with your lender(s) then they may begin the court process for possession or eviction. You will be notified in writing and it is important that you do not ignore this. You will have 14 days to reply to a claim for possession/eviction. You must seek specialist legal advice immediately for support and representation in any claim by your lender(s) to avoid losing your home.
If you fail to reach an agreement with your lender and do not attend court then it is very likely the District Judge will make an order for possession in your absence. If the District Judge does make a possession order (for example 28 days) then this does not mean you have to leave the property after the 28 days have expired as your lender will still have to apply for a warrant of eviction.
If the District Judge makes a suspended possession order on terms (example full mortgage plus a monthly amount to clear the arrears) you must maintain payments as ordered by the court, as failure to do so will very likely result in your lender asking the court to issue a warrant for eviction which can be done without another hearing.
If you experience problems maintaining payments on a suspended possession order, do not ignore the situation and let arrears build up, speak to your lender and get immediate advice.
If your lender obtains a warrant of eviction you will get a copy/letter from the court bailiffs informing you of the time and date that the eviction will take place (usually approx 10 to 14 days after warrant issue)
If you receive a warrant as above (or for any reason) you may still be able to stop/suspend the eviction by submitting form N244 to the relevant court (fee payable unless exempt via form ex160) requesting an adjournment or suspension on evidence/proposals/reasons. On receipt of the N244 form the court will grant a hearing (before the actual eviction time)
A the court hearing the District Judge will consider the evidence/proposals and make a decision as to whether adjourn the hearing/suspend possession or order the eviction to take place. If the eviction is ordered to take place you could try asking the court for more time to allow you to get re-housed.
If all your efforts to remain/stay in your home fail, you will be given an eviction time and date as already explained. This is really the end of the road and unfortunately on the named day the bailiffs will attend and evict you, forcing their way into your home if necessary (with a police presence if needed).
If you are faced with eviction and no hope of stopping or suspending a warrant you will need to look for alternative accommodation as soon as possible. Many people believe that their Local Authority (council) will re-house them when facing eviction. This is not true in all cases due to the intentionally homeless rule or if you are not classed as a priority need.
If you are facing the possibility of possession/eviction or homelessness for any reason contact your Local Authority (council) as soon as possible and ask what they can do for you with regard to re-housing.
You have rights with regard to a homeless interview and there is a Homelessness Code Of Guidance your Local Authority (council) should follow with regards to re-housing and the intentionally homeless rules etc. Make sure you know your rights and if in doubt or you are not happy about any decisions etc seek independent advice as you may be able to challenge them.
If your home is at risk and you have any doubts or are not sure about anything seek immediate independent specialist advice from a free recognised agency/solicitor (examples below)
It will greatly assist advisers and could save valuable time if you gather together as much information as possible before any interview.
What details should I bring with me for advice with mortgage arrears?