FCA announces new payment interruptions for mortgage borrowers and consumer credit customers
The Financial conduct authority (FCA) has extended its deferred payment offer for mortgage and consumer credit customers for the next six months.
The regulator said that under its proposals, borrowers who already benefit from a deferral of payment for a period of less than six months could extend that deferral. This would mean that customers could benefit from a payment deferral for up to six months.
For high-cost short-term credits (like payday loans), consumers might request a one-month deferral if they haven’t already had one.
The regulator has said it will work with commercial organizations and lenders on how to implement these proposals as quickly as possible, and will make another announcement shortly.
In the meantime, the FCA has urged consumer credit clients not to contact their lender just yet. Lenders will soon provide information on what this means for their clients and how to seek that support if the regulator’s proposals are upheld.
The regulator also said clients seeking a mortgage deferral did not yet need to contact their lenders. Lenders will provide information after today on how to apply for this support.
Consumer credit customers who have already benefited from payment deferrals and still encounter payment difficulties should contact their lender to arrange tailor-made support.
It may also be in the interest of consumer credit clients who expect long-term financial difficulties to agree on other forms of tailor-made support with their lender.
The FCA said it could also be in the best interest of mortgage borrowers who expect to have long-term financial difficulties to agree other forms of tailor-made support with their lender.
Eric Leenders, Managing Director of Personal Finance at UK Finance, said: “Lenders are providing unprecedented levels of support to help clients navigate the Covid-19 crisis and stand ready to provide continued assistance to those in need. The industry is working closely with the Financial Conduct Authority to ensure that customers affected by the new foreclosure measures announced tonight will be able to access the most appropriate support. Customers who wish to access this support do not yet need to contact their lenders. Lenders will provide information after November 2 on how to apply for this support.
Robin Fieth, Managing Director of the Building Societies Association (BSA), added: “Construction companies and credit unions recognize the financial pressures on some households and will continue to work hard to support clients in the months to come, working closely with the FCA.”