Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will hold discussions with mortgage lenders on providing flexibility to people who will find it difficult to afford mortgage repayments following the recent rises in interest rates.

On Friday 23 June the Chancellor met with the largest mortgage lenders, UK Finance and the Financial Conduct Authority to discuss a new package of support for those who encounter problems keeping up with their mortgage payments. These commitments include an agreement permitting customers to switch to an interest only mortgage, or extend their mortgage term, for 6 months, after which they can switch back without a new affordability check or it affecting their credit score. Lenders also agreed borrowers won’t have their home repossessed within 12 months from their first missed payment without their consent or unless in exceptional circumstances. Borrowers coming to the end of their deal will be able to lock in a new rate up to six months in advance of their deal coming to an end, and apply for a better rate if one becomes available.

This is in addition to the measures the Government has already taken aimed at helping people to avoid repossession, including Support for Mortgage Interest (SMI) loans, and protection in the courts through the Pre-Action Protocol.