The payment deferral scheme has been extended until the end of July 2021
There were 130,000 mortgage payment deferrals in place at the end of December 2020, broadly stable since late October but down from a peak of 1.8 million in June 2020, according to the latest figures from UK Finance.
It means that one in 84 mortgages in the UK were subject to a payment deferral at the end of last year, compared to one in six in June 2020. Industry analysis suggests that eight in ten customers have now returned to making full mortgage repayments.
The payment deferral scheme has been extended until the end of July 2021. As set out by the FCA, borrowers have until 31st March to apply for or extend a mortgage payment deferral. Mortgage holders who have not yet taken a payment deferral and now require support are encouraged to apply well before their February mortgage payment is due if they want to benefit from the full deferral period of up to six months.
UK Finance says that lenders have also announced their support for an extension of the moratorium on possessions until 1st April 2021.
Eric Leenders, managing director of personal finance at UK Finance, said: Millions of people whose finances have been impacted by the pandemic have already received support from their lender through a mortgage payment deferral.
With new lockdown restrictions in place, the banking and finance industry is continuing to help customers through these challenging times, including by providing tailored support appropriate to their needs, he said.
Leenders said, it will always be in the long-term interest of borrowers to resume making payments if they are able to do so. However, for anyone who is still struggling ongoing support will be available, and so we would urge customers to contact their lender to discuss their options before missing a payment.