Special Coronavirus rules were introduced by the FCA to help people who could not pay their mortgage: you could have 6 months payment deferrals - sometimes called payment breaks or payment holidays - if you or someone in your household had financial problems because of Coronavirus; the deadline to apply for a payment holiday was 31 March 2021; all payment holidays must end by 31 July … [Read more...]
Covid-19 – what help with debts & bills can you still get?
With the third lockdown ending in phases, this article looks at what support you can get with essential bills and debts. There are contact details at the bottom of this page for where it is suggested you should get help. More than four million payment breaks have been provided by lenders, but these lifelines are ending. If you have had six months of breaks already for a debt you won't be … [Read more...]
Coronavirus – 4 steps to take if you lose your job
A reader asks: Help! I have just been made redundant and I don't know how I am going manage, especially as we have debts. I'm only getting a few weeks redundancy pay. What should I do? A lot of firms are closing or making some staff redundant because of Coronavirus. If your firm has just closed suddenly, you may be worried about getting the pay for the weeks you have already worked, the pay … [Read more...]
Can you afford your car finance now payment breaks are ending?
Coronavirus payment breaks have been a lifeline for millions since the first lockdown started in March 2020. But now they are being restricted... You may have lost your job or be worried that may happen. You may be back on furlough or your partner may have had their hours cut or a self-employed business may have been badly hit by Coronavirus. If you know you can't pay all your debts, bills … [Read more...]
3 month car finance payment breaks because of Coronavirus
In April 2020, the Financial Conduct Authority (FCA ) set out new rules for car finance lenders on how they should respond to customers who are affected by coronavirus. It followed the general "three-month payment breaks" approach used for other credit from mortgages to credit cards. In July, the FCA these rules were extended to allow for a first or second payment break to be taken up until … [Read more...]
“When can I offer £1 to a debt?” – FAQs about token payments
A reader asked if he should offer a £1 a month token payment to his debts, wondering if his creditors would ever accept it. The simple answer is that you should make token payments offers: TO non priority debts IF you CAN'T get a coronavirus payment break WHEN it is all you can afford AND you expect your situation will improve. In 2020 millions of people have reduced household incomes … [Read more...]
Why all coronavirus payment breaks should be extended
UPDATE: On 2 November the FCA said it WILL be proposing further extensions for other types of consumer credit - that if you haven't had a break so far, you can get a 6 month break and if you have had a 3 months break since July, you can have another 3 months. On 31 October, after the Prime Minister had announced a month national lockdown, the FCA issued a statement: we will propose that … [Read more...]
Coronavirus – can’t pay your IVA? Would a break help?
If you are worried about your IVA because Coronavirus has affected your household finances, this article looks at the extra flexibility to help people in IVAs. This help has been extended to April 2021; and how things may change in the next few months, with furlough and payments breaks likely to end. Your IVA firm and your creditors will not want your IVA to fail because of a temporary … [Read more...]
“On furlough, now redundant – what about my mortgage & IVA?”
A reader, Mr D, asked: I am being made redundant, no redundancy pay as I didn't work there long enough. We have managed my IVA payments when I was on furlough by taking a mortgage holiday but that is ending and now our household income will be halving. We will struggle to pay the mortgage let alone the IVA. My partner earns too much for me to get any benefits. I know I have to tell my IVA, but … [Read more...]
SMI needs to be reformed now most people can’t have more payment breaks
Support for mortgage interest (SMI) provides help to people on benefits with part of the cost of paying a mortgage. Most homeowners whose household finances have been affected by Coronavirus have taken mortgage payment breaks. This has avoided problems with mortgage arrears and people haven't had to think about how they could get help with their mortgage costs. But people could only get six … [Read more...]