The Chancellor has announced that mortgage lenders have committed to proactively contact 1.6 million customers whose fixed rate deals end between now and the end of the year.

In a statement last night, Rachel Reeves confirmed she had secured a commitment from lenders to set out customers’ options or how they should access bespoke support “well before” the payment changes.

Reeves also reaffirmed the Government’s Mortgage Charter with lenders, keeping clear the safety net in place for anyone worried about their mortgage.

The Charter enables customers to book a new rate up to six months ahead and switch to a new deal with their existing lender without a fresh affordability check. It also offers temporary breathing space, including a move to interest-only payments for six months, with support discussions not affecting credit scores.

“In uncertain times, people need clear reassurance and practical help,” the Chancellor said.

“That’s why I’ve brought the biggest lenders together to step up support and make sure anyone who is worried can access the Mortgage Charter options quickly, without their credit score being affected.”

Government data has estimated that around 86% of mortgages in the UK are on fixed rates, as the latest measures from the Government aim to mitigate the impact of the conflict in the Middle East on households and small businesses.

Head of regulatory practice at consultancy group Broadstone, Damien Burke, described the Chancellor’s announcement as a “positive step”.

“This is a positive step that should help borrowers better understand their options well before their fixed rate deals end, which can make a significant difference in helping households plan and manage higher repayments,” Burke said.

“At a time of macroeconomic uncertainty, proactive communication and early engagement are often the most effective ways to provide reassurance and prevent short-term payment pressure from turning into longer-term financial difficulty.

“From the lenders’ perspective, the main challenge will be operational in contacting a large number of customers and providing meaningful, tailored support. I think it’s another clear use case for utilising ongoing, tailored, individual affordability assessments and flexible payment options to provide tailored, targeted support in an efficient manner.”

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