Can I get a new mortgage if I have had arrears?

Yes, though your options depend on how recent the arrears were and how severe they were. Many mainstream lenders will accept one or two missed payments that are more than a year old. For more significant arrears history, specialist adverse-credit lenders may consider your application, usually at higher interest rates and with larger deposit requirements.

What happens if I fall into mortgage arrears?

Your lender must contact you to discuss the situation and cannot begin repossession proceedings without first exploring alternative arrangements. Options may include extending the mortgage term, temporarily switching to interest-only payments, or agreeing a plan to repay the overdue amount. Repossession is a last resort and can only happen after a court order is obtained.

Is there a difference between arrears and a default?

Yes. Arrears simply mean payments are overdue — you might be one month behind but still making efforts to catch up. A default is a more formal step where the lender effectively terminates the credit agreement after a sustained period of non-payment, typically three to six months. A default is a more severe marker on your credit file than individual arrears entries.

What are Arrears? Meaning Explained

Being in arrears means you owe money that should have already been paid. If you miss a mortgage payment, you are one month in arrears; miss two and you are two months in arrears. The term applies to any type of credit but is particularly significant in the mortgage context because persistent mortgage arrears can ultimately lead to repossession.

Mortgage arrears are treated very seriously by lenders. Under FCA rules, your lender must treat you fairly if you fall into arrears, contact you to discuss the situation and explore options such as extending your mortgage term, switching to interest-only payments temporarily, or agreeing a repayment plan for the overdue amount.

Arrears on any credit account are recorded on your credit file and remain visible for six years. Even one or two months of arrears can make it harder to remortgage or obtain a new mortgage. The more recent and severe the arrears, the greater the impact.

If you are in mortgage arrears, it is important to contact your lender as soon as possible. You can also seek free advice from services such as StepChange, Citizens Advice or the National Debtline.

Example

Claire's monthly mortgage payment is £1,200. After a period of reduced income, she misses two consecutive payments and is now £2,400 in arrears. She contacts her lender, who agrees to let her spread the overdue amount over the next 12 months, increasing her monthly payment to £1,400 until the arrears are cleared. Her credit file shows two months of missed mortgage payments, which will remain visible for six years.

Key Points

Arrears mean you owe payments that are past their due date
Mortgage arrears are particularly serious and can lead to repossession if unresolved
Arrears are recorded on your credit file for six years from the date of the missed payment
Your lender is required by the FCA to treat you fairly and discuss repayment options
Free debt advice is available from StepChange, Citizens Advice and National Debtline