Customers struggling with debts threw a second lifeline ahead of the lockdown
Brits struggling with personal loans, credit card debt or car financing need additional support in light of tightening restrictions on coronaviruses.
The city watchdog said he would provide additional support to people who are paying off debts, including allowing them to defer payments, as he was concerned about the impact of a second foreclosure on people’s finances . Even those who have already applied for help will be able to take another payment holiday of up to six months.
People with high cost short-term credit, including payday loans, will be able to delay repayments by a month if they haven’t already.
Borrowers should only seek help if they really need it, the Financial Conduct Authority said. He told this newspaper he would provide more information on delaying repayments would affect a person’s credit rating.
Those who take loan or credit card repayment leave will always be charged interest during this time, which means that the amount they will have to pay back at the end will be higher.
The FCA told consumers their lenders will contact them to provide information on how to apply once the offers are confirmed.
Stephen Haddrill of the Finance & Leasing Association, a professional body, said that giving borrowers the impression that a six-month deferral was always the right answer was “dangerous” and could leave people with unsustainable debt. might have trouble repaying.
“The FCA should limit its payment deferral guidelines to three months at this point, as it did in March, so that there can be a full review of the policy and individual circumstances by lenders before any. extension. Without it, some people will continue to defer payments and go into debt to their extreme detriment, ”he added.
It comes after the Prime Minister announced that England would enter a month-long nationwide lockdown from Thursday, November 5. Following the announcement, the government said that the leave scheme would be extended month and the FCA also extended mortgage holidays for homeowners who are struggling to repay their loans.