Advising about payment problems

This page outlines an action plan that advisers may wish to consider when working with  clients with mortgage arrears.

Please bear in mind that Shelter Legal does not include detailed information about maximising income and reducing expenditure, and advisers should refer to other publications. This action plan therefore covers issues particularly relevant to people with mortgage arrears:

• Identify the reasons for the payment difficulties (for example, illness or redundancy) and assess whether the problem is likely to be long or short term.

• Consider methods of cutting the mortgage costs.

• Concentrate on controlling the arrears by ensuring where possible that at least the interest is paid on the whole of the mortgage balance.

• Maximise income and prioritise outgoings by looking at benefit entitlement and reducing to a minimum any payments made on unsecured debts.

• Consider the possibility of referral to an approved money adviser who may be able to arrange a debt payment programme under the debt arrangement scheme.

• Check whether or not a debt payment programme is already in place when dealing with people who have multiple debts as such an arrangement may need to be varied.

• If there is no long-term prospect of meeting all of the interest payments, consider the option of selling the property voluntarily or applying to the mortgage to rent or mortgage to shared equity scheme.