Homeowners worried about mortgage renewals as payment holiday ends
A quarter of the UK’s home-owners are worried about renewing their mortgage as the payment holiday comes to an end this month.
As the country grapples with an impending recession the UK’s homeowners are concerned they will be unable to renew their mortgages as earnings stagnate and mass unemployment looms.
A poll commissioned by Willow Private Finance found that 23 per cent of homeowners are concerned about renewing their mortgage due to the pandemic, as a third say their income is less secure now.
The proportion of those feeling less financially secure rises to a staggering 63 per cnet among the self-employed.
Mortgage approvals have gone through the roof in recent months as lockdown restrictions eased and pent-up demand, coupled with a stamp duty cut, triggered a buying frenzy.
This uptick in activity in the housing market is an encouraging sign but it could soon sour once the mortgage payment holiday comes to an end this month.
Approximately 2m homeowners have taken out payment holidays since the start of the pandemic and from next month lenders can start repossessing homes of those who have been unable to pay.
Wesley Ranger, managing director of Willow Private Finance said: “This is a ticking time bomb waiting to explode. Millions of mortgage holders in Britain are up for renewal in the next 12 months with changed circumstances.On top of all the other fears at the moment they are having sleepless nights worrying if they will be able to renew or even pay they bill.”
The FCA has said banks will be expected to offer tailored support to those still in financial difficulty but the recent poll shows increasing concern among homeowners for mortgage renewals.
“We are calling on the industry to show leniency for people with changed circumstances and for the government to extend its mortgage support scheme with urgency,” Ranger said.