1.9 million mortgage payment deferrals have been offered to customers impacted by Covid-19 in the three months since the support was launched, new research has found.
Customers were quick to take up the help on offer, with 1.2 million deferrals approved in just the first three weeks of the scheme.
One in six mortgages in the UK are now subject to a payment deferral, which lenders have been required to offer under new emergency rules to support consumers amid the public health crisis.
Trade body UK Finance, which compiled the data, said that the payment deferral amounts to £755 per month of suspended payments for the average mortgage holder.
Lenders will contact borrowers before the end of their deferral period with a range of options for the coming months. The range of ongoing support available includes a further full or partial payment deferral, a move to interest only payments for a period, or extending the term of the mortgage to reduce payments, depending on the borrower’s circumstances.
Customers who have not yet applied for a payment deferral and are experiencing financial difficulties and those requiring further support after an initial payment deferral can still apply until 31 October 2020.
“Lenders understand that many households will continue to see their finances squeezed as the pandemic continues, and we are working hard to ensure everyone gets the support suited to their needs,” said Eric Leenders, UK Finance managing director, personal finance.
“The industry has a clear plan to help homeowners get through these tough times, and whilst it is best for customers to restart their payments if they can, where this is not possible lenders are keen to help, whatever a customer’s financial situation.”
The statistics come as the Financial Conduct Authority unveiled extended proposals for customers struggling to pay off their credit cards, personal loans and overdrafts.
The regulator wants firms to continue to provide support to those who need it. It has proposed options such as a further payment deferral or reducing payments to an amount the customer can afford for a further three months.