Arrears on secured loans and second mortgages
This content applies to Scotland only.
Housing laws vary between Scotland and England. Get advice relating to England
If you miss payments to your secured loan or second mortgage, your lender could take action to repossess and sell your home. This section explains more about the procedure your lender must follow and action that you can take to delay or prevent your home from being repossessed. This procedure is slightly different to the standard repossession process.
If you took your loan out before 6 April 2008 and it was for more than £25,000 (or £15,000 if the loan was taken out before 1 May 1998), the lender must use the standard repossession procedure.
The page about secured loans and second mortgages explains how they differ from first mortgages and looks at what you can do if you get into arrears.
Consumer Credit Act
Secured loans and second mortgages are usually regulated by the Consumer Credit Act. This page explains how you can tell if you are protected by the Act. If you are, your lender will have to go through an extra process if you get into arrears, before beginning repossession proceedings.
Notices of sums in arrears
If you fall behind with the payments to a secured loan or second mortgage, your lender must first send you a notice of sums in arrears. They must do this before they can send you a default notice.
Default notices
If you have a secured loan or second mortgage that is covered by the Consumer Credit Act, your lender must send you a default notice before they can start the standard repossession procedures. This page explains what to do if you are sent a default notice.
Time orders
If you have received a default notice because you have missed payments to a secured loan or second mortgage, you may be able to apply to the sheriff court for a time order allowing you to repay your loan and the arrears and preventing your lender from taking further repossession action.
