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Make a decision
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- Are you able to pay our monthly instalment and an amount towards the arrears?
- If not, are your financial circumstances likely to improve? If so, when?
- Do you want to remain the home or sell it?
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| Prepare a budget |
- Prepare a budget showing all your income and expenditure.
- What items do you have to pay for?
- What are non-essential items?
- Do you have other loans?
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| Options available to you |
- Pay current instalment plus an amount towards the arrears.
- Clear the arraears with a lump sum.
- Capitalise the arrears - arrears are added to the mortgage and are then paid over the remaining term of your mortgage.
- Extend the term of your mortgage.
- Switch mortgage - for example, switch from a repayment mortgage to an interest-only mortgage, which may have lower monthly instalments.
- Payment holiday - ask for a temporary suspension of payments.
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| Contact your lender |
- Have you contacted your lender?
- Have you made any arrangements to clear the arrears?
- Have you been able to keep to any agreements agreed?
- Are the payments agreed realistic?
- Have you discussed the options available to you (listed above)?
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| Notification of court hearing |
If you are unable to make an arrangement to clear the arrers, it is likely that the lender will take possession action. You should receive a letter from the lender explaining what will happen if the arrears are not paid off. If the arrears remain outstanding then a cliam form and particulars of claim will be sent to you by the court. This will contain details of the lender's case and the date of the court hearing.
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| Preparing for court |
You need to be able to explain:
- Why you are in arrears. If you are in temporary difficulties, why and when will your financial circumstances improve?
- What contact you have had with the lender?
- How you plan to repay the arrears, together with your monthly instalments.
- The value of your property and if you have other loans secure on your property.
- If your property is for sale, how long has it been on the market?
- If there is a potential buyer. If so, what stage has the sale reached?
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| The hearing |
- It is important that you attend the hearing.
- When at court you may want to check whether there is an adviser or solicitor on a Courty Duty Desk who could assist you with representing your case.
- At the hearing the court will decide whether to:
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- grant outright possession;
- postpone or suspend possession on certain conditions;
- adjourn the case to a later date;
- or dismiss the case.
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