Urgent message for homeowners as 356,000 more people set to face mortgage issues
The financial watchdog has urged mortgage lenders to do more to help struggling borrowers during the cost of living crisis.
The Financial Conduct Authority (FCA) says lenders must offer support to customers who have missed payments or are worried they may not be able to make payments in future.
Lenders should offer options such as extending the term of someone's mortgage or making reduced monthly payments for a temporary period.
However, it stresses that these changes could result in higher monthly payments in the future or paying back more overall - so it is important to do your research first.
The FCA is urging anyone who is struggling to pay their mortgage to get in contact with their lender as soon as possible.
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It says it will continue to monitor the mortgage market and how firms are supporting their customers going forward.
The FCA has actively worked with lenders to make sure borrowers get the support they need.
It said lenders had "proactively" contacted customers a combined total of 16.5million times, across a range of channels, to offer support in the last year.
Following conversations with the FCA lenders have confirmed they expect to increase this to 20.5million contacts over the next year.
Over two million people were said to be supported by their lender last year in several ways.
These included budgeting tools, access to debt advice, and tailored mortgage forbearance.
The FCA will also continue to work with the Money and Pensions Service, consumer groups and lenders to raise awareness of the help available to borrowers.
The regulator also published new data about the current mortgage market, which did share a pinch of positive news.
The data revealed that around 356,000 borrowers could face payment difficulties by the end of June 2024.
Amongst this group, those rolling off a fixed rate deal could end up paying an additional £340 a month on average.
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However, this is down 214,000 from the 570,000 borrowers the FCA previously estimated would be in difficulty in September last year.
Sheldon Mills, executive director of consumers and competition at the FCA, said: “Our research shows most people are keeping up with mortgage repayments, but some may face difficulties.
“If you’re struggling to pay your mortgage, or are worried you might, you don’t need to manage alone. Your lender has a range of tools available to help.
"Get in touch as soon as you have concerns, don’t wait until you’re about to miss a payment before doing so.
"Just talking to them about your options won’t affect your credit rating."
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