How to deal with mortgage arrears

Reduce your outgoings

You should ask your lender for help if you can’t afford to pay your mortgage.

Mortgage payment holidays are available if you're struggling because of coronavirus. You can ask for one any time until 31 March 2021. 

You may also be able to get support with other loans and bills.

Mortgage payment holidays

A payment holiday or deferral means your lender lets you take a payment break or lets you make reduced payments.

The missed payments will be added to the amount you owe for your mortgage. Your payments will normally go up after the holiday ends. 

A payment holiday shouldn’t be recorded as a default on your credit report. But lenders and creditors may be able to see if you’ve taken a payment holiday when deciding whether to lend to you.

If you’ve already had a payment holiday

If you’ve already had a payment holiday then you can ask for another if you still can’t pay in full.

If you've had 6 months of payment deferrals since March then your lender should offer other forms of support that fit your situation. 

If you have a suspended possession order then taking a payment holiday may mean you have breached it.

Ask your lender for confirmation in writing that they won't ask bailiffs to evict. Get advice if they refuse.

Look at other options

A payment holiday won’t always be your best option.

Check if you have insurance that will cover your mortgage payments. For example, mortgage payment protection insurance or through your current account.

Ask your lender about other ways they could help. For example, they could:

  • change your mortgage so you only pay the interest
  • extend your mortgage term so you pay less per month

Support with other loans and bills

You may be able to get a payment holiday or other support for the following:

  • bank loans and credit cards
  • payday loans
  • insurance products
  • car finance and hire purchase
  • store cards and catalogues

Money Saving Expert has more information on what is offered by different lenders.

Speak to your energy supplier

You can ask your supplier for support if you're struggling with your gas and electricity bills. They can:

  • delay your bill
  • remove late payment charges
  • allow you to pay over a longer period

No disconnections should take place during the outbreak.

Switching supplier might also save you money. Use the energy comparison tool from Citizens Advice to search for cheaper deals on gas and electricity.

You might not be able to change suppliers if you owe money to your current supplier.

Consider a water meter

With a meter you pay for the water you use rather then paying water rates which are based on the size of your property.

Not everyone is better off with a meter. 

It could be cheaper if you have a larger home with spare bedrooms. It might cost more if you have a large family or live in a smaller home.     

Pay less council tax

Your council may allow you to delay payments if you’re struggling because of coronavirus.

You may also be able to reduce your council tax bill if you qualify for:

  • a discount - based on your situation
  • council tax support - if your income is low enough


You can get a 25% discount on your bill if you're the only adult living in your home. 

You might qualify for a reduced council tax bill if a disabled person lives there. Your home must have extra rooms to meet the needs of that person or be adapted for wheelchair use.

Apply for a council tax discount on GOV.UK

Council tax support

This is sometimes called council tax reduction. The scheme is run by your local council. Rules vary but you can usually get a reduction on your bill if you're on a low income.  

Apply for council tax support on GOV.UK

Coronavirus update: If you get council tax support, you'll get an extra £150 reduction on your council tax bill this year in addition to the usual reduction. You don't need to apply for this.

Shop around for TV, phone and internet

Check price comparison sites for cheaper deals.

If you find one, contact your current provider before you switch. They might offer an even better deal to keep you as a customer.

Find out how to switch provider from Citizens Advice

Last updated 20 November 2020 | © Shelter

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