Our expert comments on new proposals from the financial regulator to help mortgage customers.
- The Financial Conduct Authority has today announced a raft of proposals to support customers who are struggling to pay their mortgage due to coronavirus
- For customers yet to request a payment holiday, the time to apply for one would be extended until 31 October 2020.
- For those who are still experiencing temporary payment difficulties due to coronavirus, firms should continue to offer support, which could include extending a payment holiday by a further three months
- The current ban on repossessions of homes will be continued to 31 October 2020
Myron Jobson, personal finance campaigner at interactive investor, says: “Unprecedented times has seen the introduction of unprecedented measures to offer support to those struggling to stay financially afloat in these trying times. Under the proposals, mortgage holders struggling to keeping up with repayments during the current crisis could be entitled to a payment holiday spanning six months in total.
“Payment holidays only offer a temporary reprieve and sooner or later mortgage holders will have to pay what they owe. It is important to flag that while mortgage payment holidays should not have a negative impact on credit files, lenders may still take them into account to assess creditworthiness. So there’s no easy options, but it does allow some reprieve, and more time for people to plan their financial affairs.
“Britain’s love affair with property is well known, and beyond home ownership, our Great British Retirement Survey of 10,000 people revealed that 9% of respondents have a second home, 8% have one buy to let and 4.5% have more than one buy to let. The stock market falls this year have underscored the importance of diversification – and many may well be reassessing how many eggs they want in the residential property market too.”
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