Recognizing the potential challenges faced by homeowners, lenders covering over 75% of the market have embraced a new mortgage charter to support residential mortgage customers.

This package of support is formed into a charter, which includes several key provisions to ease financial burdens. This is positive news for residential mortgage holders and covers the following points:

1. Anyone worried about their mortgage repayments can call their lender for information and support, without any impact on their credit score and we would encourage you to contact your bank who are there to help.
2. Customers won’t be forced to have their homes repossessed within 12 months from their first missed payment.
3. Customers approaching the end of a fixed rate deal will be offered the chance to lock in a deal up to six months ahead. They will also be able to apply for a better deal right up until their new term starts, if one is available.
4. A new agreement between lenders, the FCA and the government permitting customers to switch to an interest-only mortgage for six months, or extend their mortgage term to reduce their monthly payments and switch back to their original term within the first six months, if they choose to. Both options can be taken without a new affordability check or affecting their credit score.
5. Support for customers who are up-to-date with payments to switch to a new mortgage deal at the end of their existing fixed rate deal without another affordability check.
6. Providing well-timed information to help customers plan ahead should their current rate be due to end.
7. Offer tailored support for anyone struggling and deploy highly trained staff to help customers. 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 the customer’s circumstances.

Chancellor Jeremy Hunt expressed concern for two particular groups of people—those at risk of losing their homes due to falling behind in mortgage payments and those anxious about the impact of higher mortgage rates on their family finances.

These measures were agreed to help ease some of the burden and protect households as we face some of the highest mortgage rates for 15 years.

If you are concerned about your mortgage, are within 6-12 months of the end of your fixed deal or on a variable rate and want to review your options we would be happy to help. You can contact our team online or by calling 01322 553282.