Facing Financial Difficulties

We're here to support you. If you're struggling with repayments and believe you're falling behind, we will do everything within our power to assist you in regaining your footing. The earlier you contact us, the quicker we can provide you with assistance.

In this guide, we outline the potential impact of interest rates on your mortgage and provide strategies to lower your monthly payments.

A change in interest rates can significantly influence your mortgage payments, especially when you have a variable rate mortgage.

When interest rates rise, the cost of borrowing increases. This means that if you have a variable rate mortgage, your monthly payments will also increase as the interest charged on your loan amount goes up. This can make managing your budget more challenging as your housing costs are higher.

Conversely, if interest rates fall, the cost of borrowing decreases. This can lead to lower monthly payments on a variable rate mortgage, providing some financial relief. Your mortgage payments can decrease, freeing up money in your budget for other expenses or allowing you to pay down the mortgage principal faster.

Understanding the relationship between interest rates and mortgage payments is crucial for financial planning and managing your long-term housing costs.

There are different ways we might be able to help you, and these depend on you circumstances, your existing mortgage status, and how long you believe your financial difficulties will last.

These options may include:

Changing the date of your monthly mortgage payment: sometimes, changing the monthly date when the payment is due can help you manage your money and timing. This option works best to match the date of your periodic inflow (such as salary) in sync with the date of your mortgage payment.

A short to medium term payment arrangement: these can range from a short- term deferral of the interest and principal repayments, to a full reprofiling of the amortisation profile. This options works best when your financial difficulty is temporary and you have good visibility on your future cashflows but may result in higher total interest incurred given the extended repayment profile.

Remortgaging: depending on your circumstances, you might be able to mortgage with us or with other banks if you have access to other terms that fit better your situation and cashflows. This could reduce your monthly payments. Keep in mind, however, that remortgaging might come with fees.

Extending the term of the mortgage: By spreading your repayments over a longer period, your monthly payments will be lower. Be aware, though, that this will likely increase the total amount of interest you will pay over the life of the mortgage.
* Subject to terms and conditions, refer to age criteria

Support with selling your holiday or Buy-to-Let home: If you believe your financial difficulty will last over a longer period, or is unlikely to reverse, you could consider selling your holiday home or Buy-to-Let home financed with us. If the property is worth more than your mortgage, you could use the difference to help with your situation, or a buy a more affordable holiday home. Our team will guide and support you through the process as much as possible.

This guide is provided for general use and does not substitute external professional advice specific to your circumstances. NBKI does not provide tax, investment, accounting or legal advice. Please consult with your own advisors before proceeding with any financial commitment.

All of these options depend on your personal circumstances and our eligibility conditions, and could affect one or more of these:

• The timing and amount of interest you pay over the mortgage term
• The amount you owe as arrears
• Potentially your ability to borrow from us in the future

Please contact us as soon as you believe you can’t afford your contractual payments with us, and we will do our best to support you.

A cost-of-living crisis can all put a significant strain on individuals' financial situations, making it harder to service debt and potentially leading to increased levels of debt default or personal insolvency. If you find yourself in this situation, it's always best to seek professional financial advice before making significant decisions about your mortgage.

If you’re looking for debt advice or are worried about money and finding it difficult to know where to start, the government-backed MoneyHelper service can help you find a way forward.