Mortgage worries when you have cancer
If you are worried about your mortgage
If you are worried about cancer affecting your mortgage payments, you should act as early as possible.
If you have concerns:
- talk to your lender as soon as you can
- find out what benefits you may be able to get
- get free, independent guidance from a Macmillan financial guide on 0808 808 00 00.
Finding a solution
The best solution for you depends on:
- the type of mortgage you have
- your age
- your personal circumstances
- if you can claim any extra financial support
- the amount of equity in your property.
If you are on a low income and qualify for certain benefits, you may be able to apply for a loan from the government to help pay your mortgage interest. It is important to get expert guidance about your own situation.
Talking to your mortgage lender
If you have a mortgage, you do not have to tell your mortgage lender about your cancer diagnosis. But it is usually better if you do.
If you think you will have problems paying your mortgage, tell your lender as soon as possible. You and your lender can work together to find a solution. The sooner you deal with the situation, the more options you will have.
Missed payments
If you miss 1 or more payments, this is called being in arrears. Many lenders charge a fee for this. Even 1 missed payment can negatively affect your credit score.
Most lenders have a team that helps people who are worried about missed payments. If you need help, you should speak to them as soon as you can.
You can also call a Macmillan financial guide on 0808 808 00 00.
If you miss several mortgage payments and do not talk to your lender about it, they could take serious action against you. This could include taking you to court. Eventually, you could lose your home. This is called repossession. But repossession should be the last option. If you are having financial problems, your lender should help as much as possible.
If you are facing serious action, always get expert advice from your local council. You can also contact charities such as:
- Shelter
- StepChange Debt Charity
- Citizens Advice (England, Scotland and Wales)
- Advice NI (Northern Ireland).
In Scotland, the government runs a Home Owners’ Support Fund. This may help if you are at risk of losing your home because you cannot pay your mortgage. It is made up of 2 schemes:
- Mortgage to Shared Equity scheme – the Scottish government buys a share of up to 30% in your property. This means you can reduce the loan secured against your home.
- Mortgage to Rent scheme – this scheme allows a housing association or local council to buy your home. You still live there as a tenant.
Options your lender may suggest
Depending on your situation, your lender may suggest ways to help you manage your mortgage payments. These may include the following:
- Reducing your mortgage payments for a set time.
- Changing your repayment to interest-only payments for a set time. If you do this, you will not be paying off the loan. You will only be paying the interest. Your payments will also be higher when you start paying again.
- Letting you take a break from paying your mortgage. Some mortgage contracts include the option to take a payment holiday.
- Extending the term (length) of your mortgage, so you pay less each month. This means it will take you longer to pay off the full mortgage.
- Changing your interest rate.
- Adjusting your monthly payments to cover any missed payments. You may need to pay more each month, so that you can still pay the total amount owed within the original term.
Mortgage payment holiday
Some lenders may let you take a payment holiday. This is a temporary break from regular mortgage payments. It is more likely to be possible if you have a flexible mortgage. Speak to your lender about a payment holiday. It is not automatic and not all lenders offer this, so you must contact them and apply to start a payment holiday.
You must meet your lender’s rules to qualify for a payment holiday. Find out what these rules are. Usually, these rules require you to:
- have paid your mortgage on time for a minimum period – often 6 months to 1 year
- be up to date with your payments, or not have missed more than 1 payment
- not have taken a payment holiday too recently.
If you can prove you will start making full payments again after the break, this will help your lender decide if they can help you. You should ask your lender if a payment holiday will affect your credit score.
When you take a payment holiday, your lender adds the missed payments to the total balance of your mortgage. Your monthly payments usually increase when you start paying again. This is to make up for the missed payments and interest charges during the payment holiday.
Sometimes, you may pay more than your agreed monthly payments in advance. If you have done this, you may have enough credit for your lender to agree to give you a break from payments.
If a payment holiday is included in your mortgage deal, you do not have to make any payments during the agreed period. This period is often a few months.
Tips on talking to your mortgage lender
Preparing for your conversation
Before you speak to your mortgage lender, try to do the following:
- Check whether you have an insurance policy that includes critical illness or terminal illness. You can also check if you have an income protection insurance policy or a mortgage payment protection insurance policy.
- Have details of all the money you have coming in and all the money you are spending. These are often called income and outgoings. It is important to make sure these details are correct and realistic. Check your bank statements and look at what you spend on things such as food, childcare and energy bills.
- Check if you can claim any benefits to increase your income.
- Think about how much you can afford to pay. Make sure this amount is realistic. Leave yourself enough money for food, bills and other essentials.
- Have details of your cancer diagnosis and prognosis. Your prognosis is the expected outcome of your cancer treatment, or your life expectancy.
During the conversation
When you speak to your lender, it may be helpful to talk about the following things:
- Find out if your lender has a specialist team for helping vulnerable people.
- Tell your lender about your cancer diagnosis. For example, you could mention the type of cancer you have and any treatment you are having, or will have. You could explain how the cancer and its treatment are affecting your everyday life. You only need to give details you are comfortable sharing.
- If possible, tell your lender how the cancer has affected your income and how well you manage money.
- Explain any other difficulties you have. For example, you may not be able to talk on the phone for long, or your medication may affect your memory. You could mention if someone is helping you deal with your money issues. If your lender knows about these things, they can work with you in a suitable way.
- If you can, tell your lender if and when you expect your finances to return to normal.
- Tell your lender about any claims you have on insurance or pension policies. Also tell them if you are planning to make any claims.
- If your lender suggests ways to help you, ask how your mortgage payments will be affected when this help ends. You could also ask how to stop your credit score being damaged.
What you and your mortgage lender must do
When dealing with your mortgage payments, you must:
- stay in contact with your lender and act responsibly – for example, by responding to phone calls and letters from your lender
- explore all available options for paying the amount you owe
- try talking to your lender to make a repayment agreement.
What your lender must do
Your lender must follow a set of rules to help you keep your home. These are called pre-action protocols in England, Wales and Northern Ireland. They are called pre-action requirements in Scotland. These rules do not apply to buy-to-let-mortgages.
Your lender must:
- tell you how much your current monthly payments are and how much you have paid over the past 2 years
- tell you the exact amount you owe, how much is left to pay on your mortgage, and any interest or charges that will be added
- listen to any request from you to change how you pay your mortgage
- advise you to contact the housing department in your local authority
- respond promptly to any offer of payment you make
- give reasons in writing within 10 working days if they refuse your offer of payment
- give you at least 15 working days’ written warning if they plan to start court action – this is the last option if you have not kept to a repayment agreement
- not start court action if you are taking reasonable steps to keep to a repayment agreement.
Changing your mortgage
The mortgage market changes, which means new deals can become available. You could save money by changing mortgages, but there are things to be aware of.
If you have a lot of other debts as well as your mortgage, it is possible to add these debts to your mortgage by:
- remortgaging – taking out or changing mortgages either with a new lender, or your current lender
- taking out another loan with your current lender – borrowing more from them, usually at a different rate to your main mortgage.
It is also possible to:
- take out a secured loan on your property – this is money you borrow secured against an asset such as your home
- take out a debt consolidation loan – this puts all your debts together into 1 loan (also often secured on your property).
Remortgaging or taking out another loan may let you clear your debts in the short term. But it can also be risky. Even if the interest rate is lower, it may still be hard to afford payments. The low interest rate may only last for a few years. Your payments may increase at the end of that period. Remortgaging or taking out another loan can also affect whether you can get help towards paying the interest through any benefits.
If you get a loan secured on your property, the lender can take your property if you do not pay back the money. This is called repossession.
You may have to pay fees to increase your mortgage or move to another lender. Lenders must check if you can afford your mortgage repayments. You may be refused a new mortgage, even if you think you can manage the repayments.
It is important to speak to your current lender and ask how they can help before trying to get a new mortgage. If you still think you want to change your mortgage, you should speak to an independent mortgage broker before deciding.
A family member or friend may be able to recommend a broker. You can also find one in your area by visiting:
If you are thinking about changing your mortgage because you are struggling to repay debts, you should get free and independent help. You can get this from an organisation such as Shelter or StepChange Debt Charity. You can also call our financial guides on 0808 808 00 00.
We have more information about managing debt.
About our information
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References
Below is a sample of the sources used in our finances information. If you would like more information about the sources we use, please contact us at cancerinformationteam@macmillan.org.uk
Energy savings trust. www.energysavingstrust.org.uk [accessed September 2022].
GOV.UK. Housing costs and Universal Credit. Available from www.gov.uk/housing-and-universal-credit/how-to-claim [accessed May 2022].
Gov.uk. www.gov.uk [accessed September 2022]
Gov.Scotland www.mygov.scot [accessed September 2022]
Gov.Wales. www.gov.wales [accessed September 2022]
nidirect.gov.uk www.nidirect.gov.uk [accessed September 2022].
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Reviewers
Our financial information has been written, revised and edited by Macmillan Cancer Support’s Cancer Information Development team. It has been reviewed by finance, housing and energy experts and people living with cancer. It has been approved by Amanda South, Macmillan Financial Guidance Service Manager.
Our cancer information has been awarded the PIF TICK. Created by the Patient Information Forum, this quality mark shows we meet PIF’s 10 criteria for trustworthy health information.
The language we use
We want everyone affected by cancer to feel our information is written for them.
We want our information to be as clear as possible. To do this, we try to:
- use plain English
- explain medical words
- use short sentences
- use illustrations to explain text
- structure the information clearly
- make sure important points are clear.
We use gender-inclusive language and talk to our readers as ‘you’ so that everyone feels included. Where clinically necessary we use the terms ‘men’ and ‘women’ or ‘male’ and ‘female’. For example, we do so when talking about parts of the body or mentioning statistics or research about who is affected.
You can read more about how we produce our information here.
Date reviewed
Our cancer information meets the PIF TICK quality mark.
This means it is easy to use, up-to-date and based on the latest evidence. Learn more about how we produce our information.
How we can help
There are lots of benefits that could help you after a cancer diagnosis, but the system can be confusing. Our Welfare Rights Advisors are here to help.