It only takes the loss of a job in the family and all of sudden your cumulative income could take a massive dent. At this point the fear and the panic may start to set in. Buying a house is one of the biggest investment any person makes in their life, and the prospect of not being able to pay the mortgage can be scary.
Getting into arrears on your mortgage is not the end of the line but it can be avoided. Before the reality of repossession and such forth, there are a few options you can take to avoid the impending doom.
Should I Get Mortgage Insurance? [/b]
Depending on which side of the fence you sit on, mortgage protection insurance can be seen as a necessary evil or a something you can simply deal without. The law doesn’t require owners to have it even if mortgage companies may make you feel like not having it would be a sin.
Just because lenders benefit from insurance does not make it necessarily a bad thing to have. When job security cannot be guaranteed, a mortgage guarantee is a great back-up. With this sort of protection you and your family can be protected against a whole host of scenarios including accidents, sickness and unemployment.
Could I Get Any Help To Pay The Mortgage?[/b]
Obviously a lottery winning ticket would help pay any mortgage, but in realistic terms you will not find any schemes that will write off your mortgage completely. If the worst does happen and you are made redundant, you should immediately sign on at the job centre. This way you can sign up to the government’s Support for Mortgage Interest scheme, whereby the government will pay the interest on your mortgage loan.
Whilst on benefits there is not a limit on how long you can be on the scheme. However, if you are in arrears, the scheme will not solve all of your problems because it does not help you with any payments you do owe.
You Could Sell and Rent Back [/b]
Homeowners who are in arrears face the real possibility of losing their home to repossession. For people in this situation there is still a back-up plan that can help them out. Property Rescue Limited offer sale-and-rent back agreements that can be a great fail-safe. In essence, the homeowner sells their home for well below market value, but then has the option to rent back straight away.
There are many different reasons why you might end up in arrears, including redundancy. The banks are aware of this and they preach confidentiality and speed for their customers, meaning homeowners can complete this process quickly without their neighbours even knowing.