The mortgage interest rate goes up, and you're having difficulty meeting the increased level of mortgage payments.

Required Reading


  


The mortgage interest rate goes up, and you're having difficulty meeting the increased level of mortgage payments.


If you've a repayment mortgage, you can apply to the building society to extend the term of the mortgage, which should help a bit. If you've an endowment mortgage, however, no such course is open to you.

2 You've been made redundant.

If this -unhappily no longer rare -occurrence should happen to you, tell your building society manager about it at once. You win no brownie points by keeping a stiff upper lip and maintaining silence quite the reverse, in fact. It's worth telling him even if you anticipate no great difficulty in getting another job and don't expect to fall behind with your mortgage payments. Should things take a turn for the worse, it will stand you in good stead; and, if they are quickly resolved as you expect, it won't have done you any harm.

If you become unemployed, building societies will usually allow you to put your mortgage on to an interest-only basis (this applies only to repayment mortgages; endowment mortgages are interest-only in any case), and you should apply for supplementary benefit immediately. It will pay your mortgage interest and rates for you, but only if your savings are under £12,500 (£13,000 from November 2013).

If you simply stop making your mortgage payments and offer no explanation to your building society, they may begin to make moves to evict you, usually after around six months.

Building societies are reluctant to do this, and it really is their last resort; in 2012, for example, they were forced to use this course of action against 0.058% of their borrowers, around 2,900 of them. But in many of these cases it is a fact that the building societies took steps with the active connivance of the borrower -for example, a divorced husband who had decided simply that he wasn't going to pay for the house any more.


You're buying a new house and the builders want the money in stages as it's being built.


Provided the builders are registered with the National House Building Council there should be no problems. The building society will release the money in stages as required.

The society may, however, require that their valuer visits the site to inspect progress, and the fee for this is likely to be added to your mortgage.

If you want to buy a house that is not being built by an NHBC builder, it is important that you speak to your building society first, as some are not necessarily willing to lend on this basis.

5 You've found a place to buy, but at the last minute the person who'd arranged to buy yours drops out.

You have three options here. You can try to hold up the . . .... see: You're buying a new house and the builders want the money in stages as it's being built.


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