Mortgage arrears and selling a house: your options and who to call first

StepChange says a lender should contact you to find out why a payment has not arrived and should give you the chance to get your payments back on track, either by paying in full or by paying in instalments. A late payment charge should apply only if your mortgage agreement allows it. The Ministry of Justice's Pre-Action Protocol for mortgage arrears possession claims sets out how lenders should behave before going to court. In it:

• Starting a possession claim "should be a last resort" and must not normally start until other reasonable attempts to resolve the situation have failed.
• Lenders should consider options such as extending the mortgage term, changing the mortgage type or deferring interest.
• Where you show reasonable steps to sell the property, the lender must consider postponing to allow a realistic sale period (paragraph 6.2).
• If a lender decides not to postpone, it must tell you the reasons at least 5 business days before starting proceedings.
• The protocol does not apply to buy-to-let mortgages.

Yes. StepChange says selling can sometimes be the best option if there is no other way to pay what you owe. It may not suit you if you are in negative equity, if you would have to rent at higher cost, or if you are considering bankruptcy, because a trustee can examine a sale to check it was at a fair price. If the property is worth less than the mortgage, read our guide to selling with negative equity. If you still have a mortgage and want the mechanics, see selling a house with a mortgage, and check for an early repayment charge with your lender.

If the sale does not clear the mortgage, Citizens Advice says you must pay the difference, called a shortfall, and the lender may take you to court to recover it, usually within a time limit. A shortfall can be included in bankruptcy or, if your total debts are under £50,000, a Debt Relief Order, as that page reads. You need your lender's permission to sell for less than you owe. If it refuses, you can complain to the Financial Ombudsman Service.

1. Contact your lender and a free adviser this week.
2. Work out your income, spending and what you can pay.
3. Get a valuation (our free house value check gives a sourced range from sold prices in your postcode) and compare it with the mortgage balance.
4. Ask your lender in writing whether it will allow time to sell.
5. Choose a route only after you understand any shortfall.

This page is general information, not advice.