Banks and Building Societies have been encouraged by Chancellor Jeremy Hunt to offer more flexibility to struggling mortgage holders. Following a meeting with the Chancellor, banks and building societies have agreed to offer more flexibility to borrowers impacted by increasing rates and struggling with payments, including:
- Being able to talk to their mortgage lender about their ability to afford payments with it having no impact whatsoever on their credit score
- Switching to interest-only for six months without impacting credit score
- Implementing a 12-month minimum before repossessing homes
Mr Hunt said that lenders agreed to allow struggling borrowers to extend the term of their mortgages or move to an interest-only plan temporarily "no questions asked".
The meeting between the Chancellor and lenders follows the recent decision by the Bank of England to increase its Base Rate to 5.00%, up from 4.5% as the Bank tries to tackle inflation. Millions of UK households will see their budget squeezed as a result.
If the interest rate rises or the cost of living are causing you concern about your repayments, you should speak directly to your lender. We’re also here to help offer advice and guidance when you need it.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
Approved by The Openwork Partnership on 30/06/2023
