On 22 March 2024, the UK Financial Conduct Authority published data on firms who have signed up to the Government’s Mortgage Charter.
The key points are:
– There are 48 signatories to the mortgage charter (making up around 90% of the mortgage market).
– The data suggests at least 760,000 accounts benefitted from one or more of the options set out in the Charter.
– Around 90,543 mortgage accounts have temporarily reduced their monthly payments under the FCA new rules.
– Between July 2023 and January 2024, the monthly payments on around 123,000 accounts were reduced as people switched to temporarily paying interest-only or extended their mortgage term (making up around 1.4% of the regulated mortgage contracts). Only 103 term extensions were reversed.
– The data says 67 properties were repossessed within 12 months of missing the first payment. Firms say these were for customer-driven reasons.
– It is difficult to estimate the total number of borrowers who have taken up one or more of the options set out in the Charter.
– The FCA reminds firms that the options under the Charter form only part of the support. All borrowers can contact their lender and discussion their options (see, for example, the industry’s ‘Reach Out’ campaign. This support could include contract variations or appropriate forbearance measures.