Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of introducing of a moratorium on interest rate rises for mortgage prisoners.

The Financial Conduct Authority’s review into mortgage prisoners, published in November 2021, found that the population of mortgage prisoners is varied and complex. There is no single measure to address the circumstances of this population of mortgage holders.

The pricing of mortgages is a commercial decision for lenders in which the Government does not intervene. It is worth noting, however, that interest rates are rising across the world as countries manage rising prices largely driven by the COVID-19 pandemic and Putin’s illegal invasion of Ukraine.

The Government understands that people across the UK are worried about the cost of living, and are seeing their disposable incomes decrease as they spend more on the essentials. That is why we have announced £37 billion of support for the cost of living this financial year. In addition to the Energy Price Guarantee, millions of the most vulnerable households will receive £1,200 of support this year, with additional support for pensioners and those claiming disability benefits.

If mortgage borrowers do fall into financial difficulty, Financial Conduct Authority (FCA) guidance requires firms to provide support through tailored forbearance options. The Government has also taken a number of measures aimed at helping people to avoid repossession, including Support for Mortgage Interest loans for those in receipt of an income-related benefit, and protection in the courts through the Pre-Action Protocol, which makes it clear that repossession must always be the last resort for lenders.