From 20th November, the FCA has confirmed new guidance for homeowners who are struggling financially due to coronavirus. The mortgage payment holiday scheme, first announced in March and then extended in May, has been further extended until 31 March 2021.
Key Points
- If you have not yet had a payment holiday you will be eligible for payment holidays up to 6 months.
- If you have a payment holiday currently in place, you will be eligible to top up, for a maximum period of 6 months.
- If you have previously had payment deferrals of less than 6 months you will be able to top up, as long as the total payment holiday does not exceed six months. This includes those receiving tailored support and those who are behind on payments.
- If you have already had six months payment holiday, you will not be eligible for a further payment holiday.
- The FCA has also stated that nobody will have their home repossessed without their agreement until after 31 January.
Do you have an interest-only mortgage?
If you have an interest-only mortgage (or part repayment and part interest only) that is due to mature before 31 October 2021 you can delay the repayment of capital, providing you continue to make interest payments. You will need to make your lender aware of this decision.
When to talk to your lender
Where possible, you should try to maintain your mortgage payments if you can afford to do so. If absolutely necessary, and you are considering a payment holiday or need an extension, it is vital that you speak to your lender. You must not stop making payments without contacting your lender as it could have an adverse effect on your credit rating.
Most lenders will offer enhanced support that is tailored to individuals. They will have a specialised department who can discuss personal circumstances and changes that have arisen due to coronavirus. They will be able to support customers in a way that reflects the uncertainties and challenges many people are experiencing due to the pandemic.
We’re here to help
We have a team of advisors who will be able to discuss your circumstances and provide the necessary advice and guidance. If you have any queries, please contact us on 01780 480600.
