If, like many, you have found yourself effected by the rising cost of living, in particular in energy, food and interest rates then there is support available!
In these circumstances it may not be the obvious choice to approach a Mortgage Broker like ourselves, however we are here to help. We can advise on a range of options, the impact they will have on your current and future mortgage aspirations, as well as advising other areas of support available, such as The Mortgage Charter.
Because many families are facing challenges right now, the biggest mortgage lenders in the UK, along with the Financial Conduct Authority and the Chancellor, have agreed on a set of standards, known as The Mortgage Charter, to assist people who are worried about paying their mortgage.
To date, Lenders representing approximately 90% of the mortgage market have signed up to the charter.
However, it is important to remember that all lenders are required to offer personalised help to those in need. So, even if your mortgage lender hasn’t signed up to the charter, you should still reach out to them directly for information on how they can support you if you are concerned about your ability to make your mortgage repayments.
Support provided by all Lenders, irrespective of whether they’ve signed up to the Mortgage Charter, must include;
- Being able to contact them for help and guidance, without any impact to your credit file.
- Enabling customers who are up to date with repayments to switch to a new mortgage deal at the end of their existing deal, without any further affordability checks being carried out.
- Providing well-timed information to help customers plan ahead when their current rate is due to end.
- Offering tailored support for anyone struggling – this could mean extending their term to reduce their payments, offering a switch to interest only payments, but also a range of other options like a temporary payment deferral or part interest-part repayment. The right option will depend on your circumstances.
Additionally, Lenders who have signed up to the Mortgage Charter have committed to:
- Not force a borrower to leave their home without their consent (except in exceptional circumstances) where it is less than a year from their first missed payment.
- Allow customers approaching the end of a fixed rate deal the opportunity to lock in a new deal up to six months ahead, with the option to request a better like for like deal (if one becomes available) with their lender right up until their new term starts.
- Allow customers who are up to date with their payments to:
- Switch to interest-only payments for six months, or;
- Extend their mortgage term to reduce their monthly payments, with the option to revert to the original term within 6 months.
These options can be taken by customers who are up to date with their payments, they will not require a new affordability check to do so and it will have no effect on their credit score.
Customers who are currently in arrears should continue to work with their lender for the support that they need.
In addition to support form Lenders, the Government has pledged:
- Action to make support for Mortgage Interest easier to access. If you are on Universal Credit, you can now receive help with your mortgage interest payments after three months.
- Record levels of funding for the Money and Pensions Service to provide debt advice in England.
Any borrower who can meet their new payments should continue to do so. This will always be the best course of action and will always mean you pay less interest.
If you are concerned about your ability to maintain your mortgage repayments, get in touch with us today for free advice on the options available to you, or for further information and a full list of lenders who have signed up to the Mortgage Charter click here.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Approved by In Partnership FRN 192638 February 2024.
