Mortgage lenders have offered 1.6 million payment holidays to customers impacted by coronavirus – amounting to one in seven, UK Finance Data shows.
Miles Robinson, head of mortgages at online mortgage broker Trussle, said: “It’s clear that mortgage payment holidays have proved a vital lifeline for some homeowners who have suffered financially as a result of the coronavirus pandemic.
“Many of our customers have been in touch regarding mortgage payment holidays since the parameters were set out by the government.
“We’re urging homeowners who have been financially impacted by the coronavirus outbreak to speak to their broker or lender and explore the option of a payment holiday before making a decision.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, appeared to have mixed feelings about the news.
He said: “Payment holiday is a mis-leading description for what is actually a payment deferment. Borrowers must understand that they still have to make up the shortfall when they can, plus interest, on top of their ‘usual’ payment once things get back to ’normal’.
“With one in seven people taking advantage of the scheme, this demonstrates that many people have been hit hard by coronavirus. One suspects that the longer the lockdown and uncertainty continues, even more borrowers will be forced to ask for a payment holiday.
“The difficulty in getting through to lenders may have prevented others who would have taken advantage of the scheme from doing so by now.
“Many of the larger lenders are adapting to the demand for payment holidays by moving from a physical touch to a bot-led application form with borrowers self-certifying their need.
“This has led to processing times falling and applications being transacted more quickly but may mean some borrowers are getting a payment holiday when it is not needed or the most suitable outcome. It is important to seek advice as to the best course of action.”
This post has originally been featured in Property Wire.