Certainly, mortgage is a huge decision and also a big obligation. It changes every aspect of your financial life. This instalment is perhaps the biggest one in amount and consumes a considerable part of your income. But the prime issue is, other expenses do not cooperate to compromise even a bit. They happen as regularly as before. With so many financial commitments, it is always difficult to manage the substantial obligation of mortgage. However, you cannot escape it and finally need a solution.
You need to work on two aspects – (1) At your personal level (2) At the level of your mortgage lender. Both have to work to reach to a collective and final solution.
First, count the major expenses –
- Housing (mortgage payments, repairs etc.)
- Recreation and culture ( gym fees, TV, pets etc.)
- Household (linens, appliances, furniture etc.)
- Restaurants and hotels
- Utilities (gas, water, electricity etc.)
- Council Tax
- Clothing and wear
- Personal (jewellery, toiletries etc.)
- Holiday spending
- Fines, licences (road tax, stamp duty)
Just look at this list, it is so long as if desperate to add more excuses to consume your earnings.
Now, with these many expenses it is obviously possible to sometimes lose the control on your finances. When this happens, mortgage is perhaps the first thing to get affected. This is because even a few less pennies in the instalment amount is not acceptable for the lender. This is not a holiday plan or weekend party plan, in which you can tailor the amount to be used. Mortgage loans come in long-term and influential obligations that affect your complete budget, they have to be handled seriously.
NOW, Efforts at your personal level
- Pay your essential bills first for example – utility bills, mortgage, council tax, housekeeping etc. Pay all these bills before credit cards and other short-term loans.
- If you have any kind of insurance policy for instance – income protection insurance then check if it can help with your payments.
- Look for any possibility to get tax credits or state benefits that could help add an extra amount in your income.
- Seek debt advice to know the practical ways to manage mortgage and overall finances.
- Recreate your monthly budget to cut the expenses that are unnecessary.
- Find out the ways to earn extra income.
- Rent out a part of your house or sell off the useless stuff.
Solution through your lender
The above ways were the suggestions to make efforts on personal level but it is vital to talk to your mortgage lender too. It can help to provide you an actual solution. When you took the mortgage, they did the affordability check and went through all the procedures.
- Talk to your lender and ask to work on a new plan. If possible, get your repayment schedule tailored. This is not an impossible thing, Shine Mortgages and other several lenders facilitate flexibility on this aspect.
- Go through a financial assessment with your lender to help it understand your overall financial situation.
- Ask to give you a certain time period to pay back the debt.
- Make the lender explore the possibilities of new repayment schedule. There are few options for instance – change in the date of instalments, longer tenure to reduce the monthly instalment amount. Any possibility should be explored.
In place of taking stress, it is necessary to work on the workable ways. Get active on even the slightest probability of any chaos that may become an issue later. You are the only saviour for yourself. Mortgage is a big responsibility as it is the investment of your future. It helps you have a roof of your own and on your own. Obviously, it should be handled with care.