‘Arrears’ is a term used in financial and legal situations, referring to the status of owed payments – and their corresponding due dates. It is used to describe something that has not received its payment by its set due date, so in simpler terms, ‘Arrears’ are overdue payments. If a payment is missed (one or more) the account will be in arrears – for example; a phone bill, or a mortgage.
If you miss your payments on your mortgage, and go into mortgage arrears, you will need to act quickly. Speak to your lender as soon as possible. Once your lender is aware that you are unable to make your repayments in time, they can help you get back on track.
In order to avoid mortgage arrears in the first place, have a look at these steps you can take.
Do a budget. Budgeting can be an incredibly important aid, even if you are not struggling with your money! A budget will organise your money and allow you to see anything extra you could possibly put away to tide you over if things get tight. It allows you to manage your outgoings efficiently, hopefully therefore preventing you from falling behind with repayments.