Plans to end mortgage leave must start now, MEPs warned

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Plans to end mortgage leave must start now, MEPs warned

The government and the financial services sector should already be preparing for the end of the three-month payment holiday, MEPs were told.

UK Finance and Finance and Leasing Association (FLA) officials warned that lenders’ resources were limited and payment suspensions could not automatically be expected to simply extend for three months in June if the current situation remains unchanged.

FLA Executive Director Stephen Haddrill said, “We have to figure out what will happen after three months, before June.

“I think that the scenarios must be developed now, in particular because the resources are limited.

“We don’t want to get to the end of the three-month period just to assume that there will be three more months, there has to be some serious modeling before we get to that. “

He added, “We will have to set course for what happens at the end of the three months and we will do it as soon as possible. “

Reliefs to be reimbursed

Paid vacation for homeowners and homeowners was announced by Chancellor Rishi Sunak in late March and may apply up to three months for borrowers affected by the coronavirus.

UK Finance and the Building Societies Association revealed yesterday that more than one in nine residential borrowers and buyers had applied for mortgage payment leave.

Haddrill added that as of April 3, FLA members had received 500,000 requests for payment leave and 300,000 approved.

But trade organizations took the opportunity to point out to MPs that they could not last long, that interest was running and should be paid back.

UK Finance CEO Stephen Jones added: “Financial institutions have only limited resources in terms of the number of holidays they can continue to accumulate.

“It is very important that households and businesses understand that the relief that is given must be temporary and that there will come a time when it needs to be restored. “

Owain Thomas is editor and collaborator of Mortgage Solutions and editor of Specialist Lending Solutions.
He also has experience in the areas of protection, pensions, benefits and HR.
Owain has won two Headline Money Awards and the Journalist of the Year Award for the Protection Review.



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