Coronavirus: Safeguarding a roof over your head
Coronavirus: Safeguarding a roof over your head
In the past two weeks, the government has introduced a huge range of measures designed to help those who may struggle with their housing payments. If you’re worried, already facing hardship, or even if you simply want to be clear on the help available if you need it in the future, here are the protections you need to know about.
Homeowners paying off a mortgage currently part with just under a fifth of their income to keep the roof over their head, according to data from Royal London.
If you are struggling to pay your mortgage, get in touch with your lender as soon as you can – as far in advance of the point that you may be unable to meet your payment as possible. There will be a fast-track approval process in place with quick decisions. The application is not guaranteed to be accepted and there will be implications for the remainder of your mortgage when your payments are due to start up again. Your credit rating should not be affected.
“It’s possible some lenders will consider increasing the length of your mortgage term to help mitigate this. In any case you should speak to your lender or mortgage adviser and ask them to provide an explanation of what this will mean for you and help you understand any other options which may be available to you.”
Tenants and Landlords
It took a couple of days but the government finally confirmed last week that the three month payment holiday would be extended to landlords paying buy-to-let mortgages under the same conditions and via the same application process with their lender. This, the theory goes, will mean they can pass these leniencies on to tenants who may be struggling.
Renters are also now protected from eviction for the next three months at least. That means a landlord cannot legally kick you out for any reason. This includes social housing tenants, private renters and lodgers – anyone who pays rent.
Once you have agreed a way forward, landlords and tenants “will be expected to work together to establish an affordable repayment plan, taking into account tenants’ individual circumstances”, the government states.
Commenting on the news, the housing secretary Robert Jenrick said: “The government is clear – no renter who has lost income due to coronavirus will be forced out of their home, nor will any landlord face unmanageable debts.”
Local authorities will receive a grant of £500m – split between them – to support economically vulnerable individuals and households.
“We expect most of this funding to be used to provide more council tax relief, either through existing local council tax support schemes or through complementary reliefs,” said Mr Jenrick.
Some have already indicated that they won’t pursue enforcement or legal action if residents can’t pay, but no assumptions should be made. Again, if you are struggling to meet payments, contact your local authority as soon as possible to discuss the matter.
Some have explicitly said they won’t take enforcement action for those who are unable to pay the council tax bill during the outbreak, but don’t assume that includes your own. Check to see what specific statements your local council has made about its plans for council tax payments and arrears during this period.
Although it was underreported compared with the headline announcements last week, the government also launched an emergency package with energy suppliers to ensure consumers – many of whom will see their energy bills rise significantly because they are now staying at home – don’t face any additional hardships during the outbreak. That could include the ability to review your bill payment or debt repayment plans, taking payment breaks or reducing the amount you pay, giving you more time to pay and, potentially, access to hardship funds.
Ofgem has confirmed that no credit meters will be disconnected during the outbreak. “If you think you can’t afford to pay for any extra gas or electricity used because you’re having to self-isolate at home, support will be available through your energy supplier,” the regulator adds. “Your supplier must take into account how much you can afford, and will explain your options.”
Ofgem provides further general advice on household energy bill support and who to contact if you’re finding it difficult to pay your bills. If you are a business finding it hard to pay your bills, the government has published advice on support for businesses, including available grants.
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Because we play by the book we want to tell you that…
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
There may be a fee for mortgage advice of up to 1% of the amount borrowed. A typical fee is £99 but this will depend upon your circumstances.