130,000 mortgage deferrals in place at end of 2020

There were 130,000 mortgage payment deferrals in place at the end of December, new UK Finance data has revealed.

The banking body noted that this means one in 84 mortgages in the UK were subject to a payment deferral at the end of the year – compared to one in six at the end of June.

UK Finance’s figures also indicated that the number of mortgage deferrals in place has been broadly stable since late October – following a decline from a peak of 1.8 million in June – as customers returned to making payments or sought tailored support from their lender. Industry analysis has suggested that eight in 10 customers have now returned to making full mortgage repayments.

As set out by the FCA, customers have until 31 March to apply for or extend a mortgage payment deferral. UK Finance is encouraging mortgage holders who have not yet taken a payment deferral and now require support to apply before their February mortgage payment is due, if they want to benefit from the full deferral period of up to six months.

“Millions of people whose finances have been impacted by the pandemic have already received support from their lender through a mortgage payment deferral,” commented UK Finance managing director of personal finance, Eric Leenders.

“With new lockdown restrictions in place, the banking and finance industry is continuing to help customers through these challenging times, including by providing tailored support appropriate to their needs.

“It will always be in the long-term interest of borrowers to resume making payments if they are able to do so. However, for anyone who is still struggling ongoing support will be available, and so we would urge customers to contact their lender to discuss their options before missing a payment.”

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