Barclays mortgage

Thanks for your question Pastashell

I’m sorry to hear about your diagnosis, but I hope your surgery goes well and please get in touch again if there’s anything more that we can do for you.

Firstly, it’s important to check for any insurance policies you may have which could help with the mortgage. The most common types of policy for this would be critical illness cover or mortgage payment protection insurance. If you have any insurances you’d like to discuss then get back in touch.

We also have a team of Welfare Rights advisors who are here 8am-8pm Mon-Fri and 9am-5pm Sat-Sun on 0808 808 0000. They can check to see if you’re entitled to any state benefits or charitable grants.

If you are struggling to afford your mortgage payments, or think you might begin to struggle, then it is important to contact your lender straight away. Your lender will be able to talk about your personal circumstances and the options available.

When approaching your lender, ask if they have a specialist team assisting vulnerable people and if possible, ask to speak with them.

Some helpful tips:

• Show you are willing to make repayments of an amount that is affordable
• Pay what is possible, even if this is not the full monthly mortgage payment
• Get a written copy of any repayment arrangements you make with your lender
• Keep in regular contact with your lender and let them know about any changes in circumstances

It always helps to be prepared, so here are some tips on the information you should share with your lender:

• Tell them the date when you expect your finances to return to normal
• Have details of your household income and outgoings e.g. a completed budget planner
• Have details of how much you can pay
• Contact by telephone and back up in writing, or record times of calls and who you spoke to
• Provide details of any claims you have made, or plan to make on insurance or pension policies

Ask your lender how any of the options offered might affect your credit rating and ask what can be done to minimise any negative impact

The options that are available from your lender are below, just remember to check with them how they could affect your credit rating:

Reduced mortgage payments for a specified period of time

Some lenders may let you make reduced payments for a specified period of time. They’ll usually ask for your income and out goings first to see what you can afford to pay each month. The benefit of reduced payments is that you’ll get some breathing space for an agreed period of time, but interest will still be charged if applicable and your payments may go up at the end of the reduced payment period.

Moving to interest only for a set period of time

Moving to an interest only payment for a specified period. Changing to this method of repayment means that you only pay the interest charged on your mortgage. The benefit of this is that your monthly payments will reduce, but your outstanding mortgage balance will remain the same and will need to be repaid as a lump sum, at the end of your mortgage term. This may help in the short term but it’s important to remember if you change back to capital and interest, your payments will be higher than they were.

Allowing you to take a payment holiday

Some mortgage lenders may let you take a payment holiday. A payment holiday is where you miss a set number of monthly payments (in some cases up to 6 months). It’s important to remember that interest will still be charged and your mortgage balance, as well as your payments, may go up at the end of the payment holiday.

Extending the term of your mortgage

Increasing the term of your mortgage will reduce your monthly payments but will increase the amount of overall interest you pay as you are paying it for longer. Depending on what pension provision you have, the lender may limit an extension to your retirement age. If you extend your term beyond normal retirement age you will need to consider how you would keep up repayments.

Changing the interest rate that you pay for your borrowing

By switching product either with your current lender or moving to a new lender. It’s important to check if you are tied into a deal as you may have an Early Repayment Charge.

Check with your lender to see what impact this might have on your credit rating.

Some of these options may be short term measures, so it’s important that you understand what will happen to your repayments once the agreed term has completed.

If you’d like to discuss any of this further, the Financial Guidance team is available Mon-Fri 8am-6pm on 0808 808 0000.

James

Financial Guide

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