BBC News reported recently that the governor of the Bank of England, Mark Carney, has signalled that interest rates may rise this year.
To some this will come as a shock, as originally it was thought that this rise was to start next year. To others they will have seen it coming over the horizon, the increase in house prices, the reduction of unemployment, it was only a matter of time.
Some people may even think, ‘what’s this got to do with me’. The answer is if you own your home and have a mortgage, possibly A LOT.
I’m a young professional and so are many of my friends. They have taken their first step on the property ladder and moved in with their boyfriends or even husbands now. Some of them have done it with the help of various government schemes, but the thing which they have all had the benefit of is low interest rates, making their monthly repayments not all that daunting. However, this may soon change.
Depending on the type of mortgage you have, you could find yourself in the near future with mortgage repayments which you hadn’t budgeted for, and more worryingly, which you can’t afford.
Although Mark Carney has made it clear that this rise will be gradual, most people are already working with a tight budget as they have found that their wages have not increased along with the cost of living, not to mention the cost of food, gas and electricity all increasing significantly. This further extra spend, which has not originally been budgeted for, could push many households over the edge and into arrears.
If you find yourself in arrears it is likely not going to be too long before you start receiving demand letters from the mortgage lender and then the possession proceeding court papers. At Stephensons we have a very experienced Housing Law department who may be able to help you if you find yourself in this position.
The Legal Aid Agency have changed the category of mortgage arrears from a housing law matter to a debt matter which means that it can be a little more difficult to receive face to face advice for free, however we are committed to seeing if we can help you. There is still Legal Aid funding for certain mortgage arrear cases.
If you don’t qualify for Legal Aid we can offer you specialist legal advice for as little as £49.95 for a 30 minute telephone call. This advice could stop you from losing your home and put you in a better position to negotiate with your mortgage lender.
Don’t wait until it’s too late; seek profession legal assistance as soon as you can.
By Victoria Jordan, Trainee solicitor in the housing law team