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Although the Royal Bank of Scotland has extended its repossesion time to 6 months, it is still important for borrowers to be vigilant if they find themselves falling into arrears.
The extension does not necessarily mean that borrowers can stop making payments altogether. A new repayment amount will be negotiated depending on the affordability of the borrower at the time. The mortgage may be changed from a repayment to an interest only basis or the borrowing period extended over more years. It is important to note that any accrued interest will still need to be repaid and therefore the mortgage will cost more in the long term.
The extension is designed to give people under financial stress some breathing space and in the case of someone finding themselves unemployed, longer time in which to find new work.
Borrowers should check their Mortage Protection Policies to see whether they are covered for unemployment insurance and if not, talk to their mortgage broker about taking out some protection.
For anyone finding themselves behind with repayments on their mortgage, it is extremely important to contact their lender in the first instance. Lenders can only be of assistance and help if they know the situation.
For more information or help on this or any other mortgage story, call us on 0845 0262 558.
