Mortgages.ie - Mortgages and Mortgage Protection Insurance

The consumer credit act was enacted to protect consumers when entered financial agreements. The aim of the act is to protect consumers. Further codes of conduct and legislation including the consumer protection code and the European Union Mortgage Credit Regulations are in place to further protect consumers.

WARNING: YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP PAYMENTS ON A MORTGAGE OR ANY OTHER LOAN SECURED ON IT.

If your mortgage loan is at any time at a variable rate, please note: THE PAYMENT RATES ON THIS HOUSING LOAN MAY BE ADJUSTED BY THE LENDER FROM TIME TO TIME.

Endowment loans

If you choose an endowment loan, and the insurer does not guarantee that the proceeds of the policy will be enough to repay the loan when due, please note:

WARNING: THERE IS NO GUARANTEE THAT THE PROCEEDS OF THE INSURANCE POLICY WILLL BE SUFFICIENT TO REPAY THE LOAN IN FULL WHEN IT BECOMES DUE FOR REPAYMENT.

You should also note that in the case of endowment loans, early surrender of the policy may mean that you get back less than you have paid in premia and other charges.

Will arrears on loan create a difficulty?

Some home owners have problems paying their mortgages. This could be for many different reasons such as the end of a relationship, the loss of a job, or unexpected expenses such as having a baby. If you are having financial problems, you need to act quickly, even if the problems are only temporary. If you don't, you could lose your home.

Keeping up with your mortgage payments should be your top financial priority. If you are evicted because of payment problems (repossession), you could become homeless. This doesn't happen automatically, but the longer you delay, the more difficult it will become to control your arrears and avoid long-term debts. If you have already been threatened with repossession, get advice immediately.

Act quickly

If you fall behind on your mortgage payments, you need to take action straight away. In some cases, the problem can be solved if you act quickly. Don't wait until the debt becomes unmanageable. Many lenders charge penalty fees if you miss payments. The sooner you deal with the situation the more options you have, and the less chance that you will lose your home.

Contact your lender

If you have difficulty paying your mortgage (or think that you will have, for example because you have lost your job) it's important that to talk to your lender as soon as possible. Don't be put off because you think your situation is hopeless. There is often a solution. If you haven't yet decided what to do about the problem, explain to your lender that you are going to get specialist advice about your options.

Pay as much as you can

Paying your mortgage has to be your top priority, even if you are under pressure to pay other debts as well. Losing your home through repossession would only make your debt problems worse, so it's essential to keep paying as much as you can afford. This will help to stop your mortgage arrears from rising too quickly. It will also show your lender that you are trying to tackle the problem.

Mortgage repayment protection insurance

These policies will you meet your day-to-day costs if you are unable to work due to accident or illness. These costs include items such as your mortgage, loan repayments, insurance and living expenses.

These policies are also known as income protection insurance. These policies are designed to cover up to 75% of your income or you can specify a lower amount to meet your budget.

Be cautious

A mortgage is a significant commitment relative to your income. We would recommend being very careful about taking on short term debt, particularly at the early stages of your new mortgage. Sometimes offers of credit can be very enticing but repayments can often put a lot of pressure on your finances especially if you have a young family or if one earner has reduced working hours etc.

Work out your options

The best way for you to sort out your payment problem will depend on your individual circumstances. If you want to stay in your home, you will need to find a way of stopping your arrears from rising while keeping up with your future payments. You also need to pay off any arrears that have built up so far. To do this, you need to consider:

• cutting back on non-essential spending;
• increasing your income (through wages, welfare benefits or renting out a room);
• reducing your mortgage and/or insurance costs.

If none of these options is possible, you may decide to sell your home voluntarily.

Get advice

Working out your options can be complicated. You may want to get independent advice before you decide what to do. An adviser may be able to help you to negotiate with your lender. You can get free, specialist advice from mabs.ie. Many agencies have specialist advisers who can help you work out what option is best in your situation.