Homeowners who are struggling with their mortgage and debt repayments are being urged by industry officials to seek assistance and talk to their creditors as early on as possible, to avoid getting into even deeper financial trouble, and more importantly to avoid the risk of repossession. Many homeowners are now struggling with their finances for a number of reasons. Many are still reeling from the five interest rate hikes that were applied between August 2006 and July 2007, and whilst the base rate has been reduced a few times over the last six months many lenders are still continuing to hike up borrowing costs.

In addition to this there are many other financial factors that are affecting the ability of many homeowners to keep up with repayments on their homes and other debts. The cost of petrol has soared enormously over recent months, food prices continue to rocket, and energy bills have not only gone up once already but are set to rocket again later this year. This, coupled with below inflation wage rises, will make things very challenging for many consumers in terms of their finances.

Officials from the Council of Mortgage Lenders have said that rather than simply miss repayments on the mortgage and risk serious action being taken borrowers should take early action in terms of contacting their lenders.

One official stated: “They might consider re-scheduling the loan, and there are possibilities for extending the term of the loan which could reduce payments. All of these will depend on what’s suitable in the individual’s circumstances, the lender and the borrower need to sit down and work out a plan that fits the individual’s circumstances.”

Recent additions:

• No change for the base rate for June
• Making the most of a consolidation loan
• House prices have plummeted since last year
• Should you take a secured loan or an unsecured loan?

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