Making a plan to settle your mortgage arrears
Following on from your financial self-assessment​
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Once you have conducted a financial self-assessment to understand your financial position, and maximised your monthly net income through money saving, you are in a position to make a plan to settle your mortgage debts. This is an essential step in attempting to avoid repossession of your home. By letting your lender know how you plan to get the money to repay your mortgage, the lender is less likely to take legal action and may even stop repossession all together.
Even if your case goes to court, having a plan can help you stop further proceedings, as long as it sounds viable. For that reason, a plan should only be made after gathering all the information related to your finances.
Before you write your action plan to your lender, it is important to stress that the plan must be legitimate and realistic. Go through your money saving checklist and try to set this out as clearly as possible for the lender. This part may seem the most difficult, but do not panic or get flustered. Trying to summarise vast amounts of financial information can appear daunting but the most important thing is to approach this in a logical manner.
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To help you we have created a free to use mortgage arrears plan template to complete and adapt as you feel comfortable. This sets out a forward looking plan of your expected income and expenditure, with reference to your mortgage debt, to show clearly how the outstanding arrears will be paid and how your ongoing monthly mortgage payments will be met.
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You may need to show copies of your financial statements proving income and expenses to back up your mortgage negotiation proposals too, so start putting this proof together as you form your plan. Remember, it can be easier to explain financial information and matters using numbers as opposed to words. With that in mind feel free to print and attach our template as an Appendix to any correspondence you share with your lender when writing to your lender to negotiate.
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