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Foster Denovo|News & opinion|Opinion|Homeowners and renters affected by coronavirus

Homeowners and renters affected by coronavirus

The coronavirus (Covid-19) pandemic has changed the way we are currently living our lives. In addition to worrying about our health, another concern facing many is the worry about paying their rent or mortgage during these exceptional times.

Thankfully, the government has recognised our concerns and has put in place measures that essentially offer a 3 month protection window to both homeowners and those in rented accommodation.

Homeowners

Homeowners who are impacted by coronavirus can take a mortgage payment holiday for up to 3 months, meaning mortgage payments can be temporarily stopped for a period of up to three months.

During this time, you will not have to pay anything, but interest on your mortgage will continue to be applied at its usual rate and the missed payments will need to be made up at some point in the future.

Who can take a mortgage break?

The three month holiday is suitable for those suffering a temporary drop in earnings, and is only available to homeowners who are up to date with their mortgage payments.

If you have fallen behind with your mortgage payments, there are other options available and you should speak with your mortgage provider.

How can I apply for a mortgage break?

If you are up to date with your mortgage payments, you will need to contact your mortgage lender who will have an application process in place. You must have agreement from your mortgage lender before taking your three month payment holiday and simply stopping your payments.

It is advised that if you expect you will experience difficulties in paying your mortgage or you already are, then contact your lender as soon as possible to discuss your options.

Renters

Renters who are impacted by coronavirus and are worried about paying their rent should contact their landlord as soon as possible.  And emergency legislation passed by the government also provides those who are renting with protection from eviction if they fall behind with their rental payment for up to three months.  This scheme enables tenants to temporarily stop paying their rent, but after this period, you and your landlord are expected to work together to establish an affordable repayment plan.

Landlords

In addition to providing help to tenants, landlords can also take a three month payment holiday on their buy-to-let mortgage should their tenants be experiencing financial difficulties due to coronavirus.

The same as homeowners, during this time as a landlord you will not have to pay anything, but interest on your buy-to-let mortgage will continue to be applied at its usual rate and the missed payments will need to be made up at some point in the future.

There are many organisations who are taking steps to financially help during these unprecedented times, including banks and credit card companies, energy suppliers and telecommunications companies. If you find you are struggling with any of your payments due to coronavirus, please do contact your lenders or suppliers as soon as possible to discuss your own financial situation.

Foster Denovo Limited is authorised and regulated by the Financial Conduct Authority.

 

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