Mortgage Charter

You may have heard about the new Mortgage Charter that has been introduced by the Government to support mortgage borrowers, but what is it and how can it help you.

What is the Charter?

The Charter is a set of standards that are in place for when helping mortgage customers who are worried about the high rates. These standards are a commitment to offer support and have been agreed by the UK’s largest mortgage lenders and the industry regulator: the Financial Conduct Authority (FCA).

You can view the Charter and a full list of the lenders who have signed up to it here.

What does it mean for you?

Lenders typically have their own measures in place to support customers struggling to pay their mortgage, but this Charter creates a clearer and more consistent approach for mortgage borrowers.

All mortgage borrowers, who are up-to-date with their payments but struggling, now have these opportunities:

• Switching their mortgage to interest-only for six months
• Extending their mortgage term and having the option to switch back to the original term within six months

These solutions lower repayments without affecting credit scores or requiring new affordability checks. In addition, lenders have agreed to not action repossessions within a year of first missed payments.

However please noted the following:

• These commitments do not apply to Buy-to-Let mortgages
• Applies to 97% of the mortgage market, where customers are up to date with payments and not seeking to borrow more or change their repayment type or term.
• No further action will be taken if a Possession Order is granted from 26 June 2023.
• Rates must be finalised two weeks before the new term starts.
• Monthly payments after the support may be higher than they otherwise would have been and overall costs over the life of the mortgage will be higher. Affordability will need to be checked if borrowers wish to permanently convert to an interest-only mortgage, or where the mortgage term is proposed to be extended beyond the borrower’s expected retirement date.
   

So how can Brooklyns Financial help?

Will advise you on the options available that are bested suited to you. We are here to help you every step of the way Just give us a call 01628 564631 or email us info@brooklynsfinancial.co.uk for an initial chat?

The information contained within was correct at the time of publication but is subject to change.

Your home may be repossessed if you do not keep up repayments on your mortgage.