The FCA has mapped out the support firms should give to mortgage customers who are either coming to the end of a payment holiday or are yet to request one.
The body outlined that firms will offer support for customers still experiencing temporary payment difficulties due to the current health pandemic, with options including a full or part payment holiday for a further three months.
Issuing its update, it was also emphasised that if they can afford to resume payments, customers should.
Christopher Woolard, Interim Chief Executive at the FCA, stated: “’The measures we have confirmed today will mean anyone who needs to, can get help from their lender if they are still struggling to pay their mortgage due to coronavirus.
“It is important that if a consumer can afford to re-start mortgage payments, it is in their best interests to do so. Customers should talk to their firm about the best option available for them.”
Payment holidays offered under this guidance will not have a negative impact on credit files. However, consumers should remember that lenders may use information obtained from other sources, such as bank account information, in their lending decisions.
Depending on the customer’s circumstances, firms may make them aware of self-help steps a customer may take or signpost customers towards sources of debt advice. This will be for anyone concerned about managing their money during coronavirus and wants to find out what steps to take to get back on track.
This guidance comes into force on 4 June 2020 and only applies to mortgages. It does not apply to consumer credit products which are covered by separate guidance which will be updated in due course.
Expert Analysis: The COVID-19 crisis has forced every industry to adapt, the flexibility of the FCA when it comes to regulations is commendable and will help restore financial stability for many after the pandemic.