Bank of England Urges Leniency on Mortgage Holidays --Financial News
May 22 2020 - 5:24AM
Dow Jones News
By Berengere Sim
Of Financial News
The Bank of England wants U.K. lenders to be lenient when
assessing whether borrowers who opted for a mortgage payment
holiday continue to face hardship due to the pandemic.
The BoE's Prudential Regulation Authority said Friday that
lenders must make "well-balanced and consistent decisions" that
take into account the potential impact of the coronavirus.
More than 1.8 million mortgage payment holidays have been
approved by lenders across the U.K., after it was first announced
in March as part of the government's broader fiscal support package
to provide support to households and businesses during the Covid-19
crisis, according to figures released by the U.K. Treasury
Friday.
The call comes as the Financial Conduct Authority proposes to
extend the mortgage payment holiday for borrowers until Oct. 31.
The extension would be available to borrowers experiencing
financial difficulty at a later date.
The ban on repossessions of homes will also be delayed until the
end of October.
The payment holidays provided shouldn't have a negative impact
on credit files, the regulators said.
"Everyone's circumstances will be different, so when homeowners
can pay some or all of their mortgage, they should work with their
lender on a plan; but if they are still struggling, I want them to
know that help is there," said John Glen, the economic secretary to
the Treasury, in a statement.
Interim chief executive of the FCA, Christopher Woolard, said
that anyone who continues to need help should get help from their
lender. "We expect firms to work with customers on the best options
available for them, paying particular attention to the needs of
their vulnerable customers, and to provide information on where to
access help and advice."
The FCA said it will take comments on the proposals made until
May 26 and, following that, will issue final guidance.
Website: www.fnlondon.com
(END) Dow Jones Newswires
May 22, 2020 06:09 ET (10:09 GMT)
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