Letter to mortgage company

[timeforchange]

does any body have a sample letter to send to a mortgage company telling them about financial difficulties and asking them to reduce your payments for a set period , give you a 'payment holiday' or extend your mortgage term to reduce your payments etc etc . i am a month behind with my payments and next payment is due out next week, i need help! i just dont have a clue what to say, it sounds rubbish when i write it

[powelll]

Firstly, do you have any other credit agreements that you are currently paying? Anything like unsecured loans, credit cards, HP, catalogues, finance etc etc.

The reason I ask is to see if you are in difficulty because of any of these. Your mortgage company is a priority creditor and while it's usually good to keep everything in writing you should speak to them as well ( and just confirm stuff in writing ). It's hard to be specific when we don't know your exact circumstances...

[timeforchange]

yes i do, i have lots of little niggly debts

at the moment i am just writing letters to the creditors of my non priority debts (about 5k), i have done a budget and i only have 30 pound left over every month if i really scrimp and save, that is if i pay my mortgage (294) and secured loan (272), (but not including last months payment that i missed (294 + 272))

my barclaycard and littlewoods visa cards are on a payment plan already but these need to be lowered still.

partner got laid off at work (scaffolder) then it took 4 wks to find another job!! ( going from £500 + per week to just £290) had to work a week lying on, we had booked a holiday last year for june this year, he wasnt entitled to holiday pay with just starting new job, so went for 2 wks end of june with no pay, then had to work another week lying on when we got back,

mortgage was due when we were away on holiday, i knew there would be no money in bank to pay 1st july payment so i cancelled DD so as not to get charged by the bank and mortgage and the same with secured loan that was due on the 28th june. when i came back i have found that the bank has lost 2 cheques that i had put in before we went away (equalling £120) to cover the council tax that was coming out the day we went on holiday, so the money didnt go in so the account went overdrawn and barclays slapped on 60 quid more charges... etc etc etc and so on ... totally spiralling out of control.


just read that back and it doesnt make much sense, but nevermind

[powelll]

OK. You need to reduce payments to non priority creditors to zero or £1 per month token offer. Any surplus you have ( if £30 is too much of a struggle reduce it ) should be offered to clear the mortgage & secured loan in instalments.

Try to keep mortgage & secured loan arrears below 2 months if at all possible ( lenders can only go for repossession via court if you have missed 2 months+ payments ).

Don't speak to non priority creditors - just use letters to offer payment of the token or zero offer with a budget sheet showing you have no surplus income at the moment. The mortgage & secured lender are the ones you should be speaking to and keeping up to date with your situation - they are far less likely to agree to eg payment holiday or add the arrears to the end of your mortgage if you are already behind.

I think you would find it useful to speak to National Debtline on freephone 0808 808 4000 for free confidential impartial advice but I have also linked to their website below - budget sheet is v detailed:

National Debtline England & Wales | Personal Budget Sheet

National Debtline England & Wales | Debt Advice

[timeforchange]

thanks, i will do that, i have actually been on the phone to the CCCS and debtline last night and this morning.

i was trying to get a loan to consolidate all the debt we have and reduce payments but the guy on the phone advised against this as my secure loan is with welcome finance and he said they have a tendancy to whack big charges on if you pay off the loan early.


i feel so worried and down with all this, i feel like curling up in bed and hiding under the covers for a few months

[timeforchange]

just to add, what should i say to my mortgage lender and secure loan people, i just dont know what to say without sounding stupid or getting talked into payments i cant make

[powelll]

Originally Posted by timeforchange

thanks, i will do that, i have actually been on the phone to the CCCS and debtline last night and this morning.

i was trying to get a loan to consolidate all the debt we have and reduce payments but the guy on the phone advised against this as my secure loan is with welcome finance and he said they have a tendancy to whack big charges on if you pay off the loan early.


i feel so worried and down with all this, i feel like curling up in bed and hiding under the covers for a few months

I ahve to say I agree that consolidation is not usually the way to go - I deal with loads of people who have done this in the past & they are no better off as a result for one reason or another.

It's really easy for me to say but please try not to let this affect your health & wellbeing. People get into financial difficulties for all sorts of different reasons and no one is judging you. The head in the sand ( or under the covers! ) appraoch is a well worn path but you will have to surface at some point and things may seem worse as a result.

If you can cover your essential bills ( mortgage, secured loan, council tax gas, elec, water ) as well as stuff like essential insurances, food, clothes travel costs etc etc then you are not in as bad a position as you may think. Basically any non priorities will just have to wait. What they want you to pay and what they actually get are two different things.

But the non priorities are the ones that will shout the loudest and make noises about using debt collectors etc. Remember debt collectors are not bailiffs so no right to enter your home or take goods.

You are in a strong position one essentials are covered as your home isn't directly at risk and you don't stand to lose essential services. Plus there are so many people out there in various guises who can offer really good quality free advice.

[timeforchange]

should i send this letter to my non priority creditors??

Dear Sir/Madam

Re Account No/Reference No:- XXXXXXXXXX

Since making that above agreement with you, our circumstances have changed.

We cannot now afford to agreed monthly payments because what should I put here?
We enclose a Personal Budget sheet which shows our total income from all sources, and the total outgoings of our household. As you can see we have no money left to make offers of payment to my creditors.

In view of our circumstances, would you please accept no payment at present to be reviewed in six months. If interest or other charges are being added to the account, we would be grateful if you would freeze these so our debt does not increase.

Should my circumstances improve we will contact you again.

Thank you for your assistance. We look forward to hearing from you as soon as possible.

Yours faithfully

me



And if i have 30 left a month, would i just offer this to the mortgage and secure loan to pay off the arrears? (obviously if i have any extra left over a month i will pay it to these to clear the arrears)

[powelll]

The letter is fine, when it says the because bit you can just say your circumstances have changed. You're not obliged to elaborate any further if you don't want to.

[timeforchange]

i have just been on the phone to welcome finance, they have taken a part payment today, and are going to phone to take another part payment next week.... and said that they are leaving next months payment, till we get back on track... phewwwww!.
now, capstone, i cant get through to them! i have been on hold for 30 mins,

[timeforchange]

Originally Posted by powelll

The letter is fine, when it says the because bit you can just say your circumstances have changed. You're not obliged to elaborate any further if you don't want to.

oh right, great, thanks

[midge61]

Hi

This will cheer you up capstone have a few problems of their own at the moment HE HE HE

SPPL Judgement set aside advice

Good luck

[Goldlady]

Keep your mortgage and secured loan arrears under two months installments - we were in a mess last year and the secured loan company issued repossession proceedings with no warning when their phone people were being kind and saying just pay what you can when you can.

[timeforchange]

soooo, thats why i havent had any phonecalls or letters about my late payment on mortgage... coz they are getting there botties slapped te he he

[gizmo111]

Is there any chance you get the mortgage reduced to interest only repayments for a couple of months whilst you get straight. Did your partner claim benfits whilst he was unemployed and if so di yo uclaim the council tax benefit for that period?

As said above you must prioritise your mortgage secured loan council tax and utilites. If your bank account is overdrawn open an account elsewhere that you do not owe money and treat the OD as just another debt. You wil lthen have the whole of your income to distribute as you see neccasary and no fear that the bank will either reduce od or use offset.

Forthe long term get redemptions from welcome and capstone and shop around for a cheaper deal for the whole amount owing - both are usually very expensive borrowing options.

[timeforchange]

Originally Posted by gizmo111

Is there any chance you get the mortgage reduced to interest only repayments for a couple of months whilst you get straight. Did your partner claim benfits whilst he was unemployed and if so di yo uclaim the council tax benefit for that period?
my mortgage is already interest only, and no, my partner did not claim benefits, dont ask why not coz i dont have a clue why (we had huge arguments about this)
As said above you must prioritise your mortgage secured loan council tax and utilites. If your bank account is overdrawn open an account elsewhere that you do not owe money and treat the OD as just another debt. You wil lthen have the whole of your income to distribute as you see neccasary and no fear that the bank will either reduce od or use offset.
i dont have an overdraft on our bank account
Forthe long term get redemptions from welcome and capstone and shop around for a cheaper deal for the whole amount owing - both are usually very expensive borrowing options.

hopefully in october we will be able to remortgage, (since we bought the house we have done an awful lot of work on it and i am positive that it will have risen in value by quite a lot, so hopefully we will be able to get enough to clear all our debts), but i am not sure, have to check my mortgage docs