One in six homeowners with mortgages now on payment break

One in six home owners with a mortgage across the UK are now on some form of payment holiday with lenders beginning to produce support packages for those borrowers in difficulties and nearing the end of the scheme.

For the average mortgage borrower the total payment deferral typically amounts to £755 per month.

Some 1.2m deferrals were approved during the first three weeks of the scheme and another 0.7m have been added since.

A statement from lenders’ trade body UK Finance says that many homeowners will soon be coming to the end of the deferral period and lenders are now focused on helping customers to consider their next steps.  

“They will contact borrowers before the end of their deferral period with a range of options to ensure they are supported through the coming months, whatever their financial situation” explains UK Finance. 

“Borrowers who can afford to resume payments should do so, as it will always be in their best interests in the long run. However, for those who can’t then help is at hand. Where possible, borrowers will be able to explore their options online” it adds.

The range of ongoing support available includes a further full or partial payment deferral, a move to interest only payments for a period, or extending the term of the mortgage to reduce payments, depending on the borrower’s circumstances.

Customers who have not yet applied for a payment deferral and are experiencing financial difficulties and those requiring further support after an initial payment deferral can still apply until October 31.