Maintaining a mortgage can be challenging when you are experiencing economic abuse. In some cases, arrears can build up and the lender may consider repossession. This can be a difficult and frightening situation to be in if you have experienced economic abuse.
If you have separated from an abuser that you share a mortgage with, legal proceedings to decide on what to do with the home can take a long time. It can even take years if the abuser is effective in delaying them, and you may experience challenges with the mortgage in this time.
There is no clear route to split a mortgage when economic abuse is taking place. However, you do have options. This resource outlines ways to help you maintain the mortgage and deal with challenges that may arise.
On this page
If you are facing repossession proceedings, you can seek specialist legal advice from a housing solicitor. Legal aid is available for representation during possession hearings for those who are eligible. The Government recently removed the mortgage cap on legal aid eligibility, so the size of your mortgage will not exclude you.
The Legal Aid Agency has recently recognised that domestic abuse survivors may have ‘trapped capital’. Trapped capital is money that is tied up in a property and that you can’t access. This may be because you jointly own your home with the abuser, and they will not agree to the property being sold or borrowed against. This change to the legal aid rules means that, in some cases, it may now be easier for you to access legal aid as a homeowner.
For information on where to get free legal advice about repossession, visit this guide from Shelter.
Free, specialist debt advice is available for anyone who is concerned about mortgage arrears. Speaking to a qualified debt adviser who is trained in economic abuse may be especially helpful to explore the best options for you.
You can contact the Financial Support Line for victims of domestic abuse for further support. Please note that volume on the Line is very high, so it may take a while to get through. You can find details of other debt advice options here.
It is best to contact the lender as soon as your circumstances change. However, this can be challenging and there are many reasons why you may not have done so straight away.
It may feel daunting to speak to your lender about the economic abuse you have experienced. Your lender is there to support you, and some lenders have specialist teams to support those experiencing economic abuse.
If you can, explain why you are in arrears or have missed a payment. This can include if the perpetrator:
You can contact the lender at any point, even if court action has begun or if this is not the first mortgage payment you have missed. The sooner you contact them, the better. They may be able to offer forbearance to help manage the cost of the mortgage if you are in arrears. Forbearance is when the lender temporarily reduces or postpones payments if you are in financial difficulty.
Even if you cannot make your full monthly mortgage payment, it may be an option to pay what you can. These payments, however small, can show a lender that you are:
If you are receiving other benefits, you may be eligible to get help with the cost of the interest on your mortgage payments. This help is called Support for Mortgage Interest (SMI). SMI is paid as a loan, which you’ll need to repay with interest when you sell or transfer ownership of your home. You can find out more about Support for Mortgage Interest (SMI) here.
In some cases, selling the home might be an option if it could cover the costs of your mortgage and any arrears. If you want to stay on the property ladder, or have enough money to buy elsewhere, it is important to consider whether you are likely to have money left over from the sale.
You may be facing difficulties because the fixed term of your mortgage has come to an end and the abuser is preventing you from switching to a lower interest rate.
The lender may consider a new mortgage with a fixed rate, but these often include a financial penalty if the mortgage is repaid early over the fixed rate period. This is called an early repayment charge (ERC). Because of this, the lender may not offer a fixed rate as the ERC could cause potential harm to both borrowers if the intention is to sell the property or change the mortgage terms in the near future.
However, some lenders offer tracker rates that don’t have fees or ERCs and in some cases, lenders are able to switch without the consent of the abuser. Speak to your lender, there may be more they can do to help you to address your situation so that you don’t experience further harm because of economic abuse.
If you can stay living in the property long-term, taking out your own mortgage without the abuser could be the final step to de-linking economic ties. However, you should speak to your lender as this may only be possible if:
You could speak to your lender about whether they can offer flexible affordability assessments. They may be able to take into account the economic abuse and whether you have been covering full repayments independently for a while or if you have more disposable income now you are no longer with the abuser.
Before considering repossession, the lender should discuss other options with you. These could be:
It is essential for the mortgage lender to keep records of all communication with you. You may wish to record these details for yourself, as well, and keep them in a safe place.
Many mortgage providers have agreed not to force people to leave their home within a year of their first missed payments. If your mortgage has been in arrears for some time, your lender may be considering legal action to repossess the property.
This can be stressful, but acting as early possible will give you the best possible chance to resolve the matter with the lender. It is important to:
A lender should welcome your continued engagement, as they want to find a way for you to continue to make payments. They earn money from mortgages, so your continued payments are a better outcome for them than repossessing your home.
They cannot repossess your home unless all other attempts to resolve the issue have failed.
You should not feel pressured by your lender. You can ask if the mortgage lender has a vulnerable customer team and, if you feel comfortable, you may wish to disclose the abuse you have experienced.
The UK Finance 2021 Financial Abuse Code sets out the ways in which financial service providers should respond to vulnerable customers. They should respond with empathy, invite you to speak privately, and will hopefully be more flexible in their approach to working out a repayment plan.
In addition, the lender must follow rules set out by the Financial Conduct Authority (FCA) before they can begin any court action against you. These include:
Even if they have already begun court action, you can still approach the lender to try to make an agreement. They may be able to offer a flexible approach to repossession including tailored communications or delaying repossession if it makes you homeless because of the abuser’s actions.
If you feel repossession is the best option, you may want to speak to your lender about expediting the repossession and disregarding token payments made by the abuser to try and delay proceedings.
Your lender must write to you 5 working days before they start court action and explain why they are applying to court.
At the repossession hearing, they need to show that they’ve followed the rules in the pre-action protocol checklist. The judge could adjourn the hearing if your lender has not followed the rules. This means that the hearing is put back to a later date to give the lender time to comply.
It is important that you attend your possession hearings. They can be an opportunity to explain to the judge why you should keep your home or sell it yourself. If you are not present at the hearing, the judge will probably make a decision against you.
If you cannot attend because of a sudden illness or family emergency, you should tell the court straight away.
If you are waiting for decisions on Universal Credit, homelessness help from the council, a Support for Mortgage Interest Loan (SMI), or mortgage protection payments from an insurance policy, your mortgage provider may be able to delay any court action.
Your lender must also consider delaying court action if you’re waiting for the outcome of a complaint to the Financial Ombudsman. If the lender goes ahead with court action before the ombudsman makes a decision, they must write to you and explain why.
They might not delay court action unless you can show that you:
Voluntary repossession means you (and any other homeowner) leave the property and give the keys to the lender. It does not clear your mortgage arrears or outstanding payments, and still has a negative impact on your credit rating.
The property may be sold at auction at a lower value. This may leave you with an outstanding mortgage because of the negative equity. Negative equity means you would still owe the lender the remaining balance.
In some cases, you may still feel that it is the best option, particularly if the property has been damaged by the abuser or is in negative equity (where the mortgage is worth more than the home). It is important to know that if you accept voluntary repossession and have nowhere else to live, the local council may decide that you are intentionally homeless.
You will also still need to pay:
Some lenders may be flexible with what they charge you so you should speak to them about what options may be available.
Last updated September 2024
Surviving Economic Abuse is a registered charity. If you would like to support our work you can make a donation or become a regular giver. Visit our donations page for more information
© Copyright 2024 Surviving Economic Abuse | Registered Charity Number 1173256
