In case you missed it at the end of May the government announced that mortgage repayment holidays will be extended. Enable’s experienced IFAs of Bishops Stortford noticed that The Government and the Financial Conduct Authority (FCA) announced proposals to extend mortgage repayment holidays for those financially impacted by the Covid-19.
Many homeowners continue to be hit financially by the pandemic, so recently the FCA published new draft guidance for mortgage lenders that will include extending the application period for a mortgage holiday until 31 October 2020. This extends the mortgage holiday scheme by 3 months. As well as being able to extend existing payment holidays, the new guidance will also allow those who have not yet requested a payment holiday but who are experiencing financial difficulty to request one.
Since the scheme was announced in March more than 1.8 million homeowners have taken the 3-month mortgage holiday on offer. John Glen, the economic secretary to the Treasury said – “we can to help people with their finances at this difficult time and that includes making sure people get the support they need with their mortgages,” said. “That’s why we’re working with the banks and lenders to extend payment holidays if people need them.”
He added – “Everyone’s circumstances will be different, so when homeowners can pay some or all of their mortgage, they should work with their lender on a plan, but if they are still struggling, I want them to know that help is there.” Even if you do not need a mortgage holiday it might be a good time to review your mortgage.
When considering your options homeowners need to consider the cost of a mortgage holiday. Interest is likely to continue to be added to the mortgage during the repayment holiday resulting in having to pay higher monthly repayments. It is wise to consider all the options available before taking a repayment holiday. Enable’s IFAs are here to help you through.