Financial Conduct Authority confirms updated support for mortgage borrowers impacted by coronavirus

New guidance comes into force from 20 November 2020, but lenders are encouraged to provide enhanced support sooner where they can

The Financial Conduct Authority (FCA) has confirmed updated support for mortgage borrowers impacted by coronavirus (COVID-19).

Following a brief 'comment period' after it published draft guidance on 2 November 2020, the FCA has now confirmed the enhanced support that will be available to mortgage borrowers experiencing payment difficulties as a result of coronavirus - 

• those who have not yet had a payment deferral will be eligible for payment deferrals of six months in total;
• those who currently have a payment deferral will be eligible to top up to six months in total; 
• those who have previously had payment deferrals of less than six months will be able to top up, as long as total deferrals don’t exceed six months - this includes those receiving tailored support and those who are behind on payments; and
• while borrowers who have already had six months of payment deferrals will not be eligible for a further payment deferral, firms will provide tailored support appropriate to their circumstances, which may include the option to defer further payments.

NB - the FCA says that tailored support will continue to provide help for those who will not be eligible for further payment deferrals under the new proposals.

Also confirming that no one should have their home repossessed without their agreement until after 31 January 2021, interim Executive Director of Strategy and Competition at the FCA Sheldon Mills said -

'Today we have confirmed further support for borrowers struggling financially as a result of coronavirus.

The announcement we have made today, ensures that the support offered through payment deferrals is as flexible and accessible as possible. This means borrowers will again be able to access payment deferrals up to a maximum of 6 months. However, if you are able to keep paying it will be in your best long-term interest to do so. Payment deferrals should only be taken when absolutely necessary.'

For more information, see FCA confirms support for mortgage borrowers impacted by coronavirus from fca.org.uk