Mortgage Charter Brings Help for Borrowers
The majority of UK lenders have signed a government charter to support
borrowers.
The charter includes allowing borrowers to contact their lender for help without
impacting their credit file and enabling borrowers whose payments are up to
date to switch when their fixed term ends without another affordability check.
Mortgage holders approaching the end of a fixed rate term will now have the
chance to lock into a new deal up to six months ahead. They will also be able to
request a better like-for-like deal with their lender right up until their new deal
starts, if one is available. This allows borrowers to hedge their bets – if interest
rates go up during the six months, those who locked in from the start will be
paying a lower rate than otherwise.
In addition, a borrower will not be forced to leave their home unless in
exceptional circumstances within a year of their first missed payment.
In a deal between lenders, the Financial Conduct Authority and the government,
customers who are up to date with payments can either switch to interest-only
for six months or extend their mortgage term to reduce their monthly payments.
Customers will also have the option to revert to their original term within six
months.
Your home may be repossessed if you do not keep up repayments on
your mortgage