Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Housing, Communities and Local Government, what discussions he has had with the Chancellor of the Exchequer and the Financial Conduct Authority on resuming the ban on lender repossession of homes, which expired on 31 October 2020.

To protect homeowners from repossession, the Financial Conduct Authority (FCA) announced a moratorium on lender repossession until 31 October 2020. On 2 November 2020, the FCA launched a consultation on new draft guidance to their members that states that there will be a moratorium on the enforcement of lender repossession until 31 January 2021, except for in exceptional cases (such as a borrower requesting proceedings continue). This will protect homeowners from lender repossession over this period and will enable them to stay in their homes.

The guidance also details that the mortgage holidays will be extended, with applications open to 31 January 2021. Borrowers that have been affected by Coronavirus and have not yet had a mortgage payment holiday will be entitled to a six-month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.

The FCA has been clear that for borrowers who have taken six months’ holiday and continue to face ongoing financial difficulties, firms should continue to provide support through tailored forbearance options. This could include granting new mortgage payment holidays. Mortgage customers in this situation should speak to their lender to discuss their options.