UK households have seen their income fall by a quarter, according to FCA’s latest customer research
Industry figures show that 162,000 mortgage payment deferrals are currently in place, down from a peak of 1.8 million in June.
The data, released by UK Finance, suggests that over three-quarters of customers whose payment deferral has come to an end have now returned to making repayments.
Lenders have now provided a total of 2.5 million mortgage payment deferrals since the start of the pandemic.
In line with the latest guidance from the FCA (Financial Conduct Authority), lenders will continue to offer a range of options to support borrowers who face financial difficulty. The regulator’s latest customer research also shows that almost a third of adults (31%) have seen a decrease in income, with households seeing income fall by a quarter, on average.
To ensure these households are supported, all lenders will offer tailored options to support customers through payment difficulties resulting from Covid-19, taking into account their personal circumstances including any local restrictions that may be imposed. Support will be available both for those who have previously taken a payment deferral and those who are newly in financial difficulty.
Ongoing support for mortgage customers may include extending the length of the mortgage term, changing the type of mortgage (e.g. a temporary change to an interest-only mortgage), deferring payments, or capitalising the interest accrued.
Eric Leenders, managing director of personal finance at UK Finance, said: The banking and finance industry is providing unprecedented levels of support to help customers through the Covid-19 crisis. We understand that many people’s finances will continue to be impacted by this pandemic and want to reassure them that ongoing help is available, tailored to their individual circumstances.
It will always be in the best interest of customers to resume making payments on their mortgage, loan or credit card if they’re able to do so, he said.
Leenders said, however, anyone still experiencing financial difficulty should get in touch as early as possible to discuss the options available, starting by checking their lender’s website which will be updated with the latest information.
This article is for information purposes only.
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