At least 1.1 million mortgages have benefitted from measures introduced by the Mortgage Charter, the regulator’s data showed.
According to the Financial Conduct Authority (FCA), this accounts for the number of borrowers who locked in a new fixed rate up to six months before their deal ended between July 2023, when the support was introduced, and April this year.
Over the same time period, more than 284,000 borrowers who secured a new deal six months before their fixed rate matured then went on to obtain an alternative product.
The Mortgage Charter was created to encourage lenders to help borrowers deal with rising costs. It has 49 signatories, which represent around 90% of the mortgage market.
This included allowing borrowers to contact their lender for help without impacting their credit file and enabling borrowers who are up to date with payments to switch to a new mortgage when their fixed term ends without another affordability check.
Reducing payments
It also gave borrowers the option to extend their mortgage term or switch to interest-only payments to reduce monthly outgoings, or temporarily defer payments.
Since coming in, around 159,000 monthly mortgage payments were reduced as people temporarily moved to interest-only payments or extended their mortgage term.
This accounts for 1.8% of regulated mortgage contracts, the regulator said.
Its data showed that only 263 term extensions were reversed, which the FCA suggested meant borrowers wanting to reduce their mortgage payments were more likely to choose an interest-only payment period.
Around 113,000 mortgages are still on temporarily reduced monthly payments due to the Mortgage Charter rules.
Voluntary repossessions
The Mortgage Charter also states that except in “exceptional circumstances”, borrowers will not be evicted from their homes without their consent less than a year from their first missed mortgage payment.
Since the charter was introduced, 91 homes were repossessed within 12 months of the first missed payment. Lenders said these were for customer-driven reasons, such as voluntary repossessions and abandoned or vacant properties.
Shekina is the deputy editor at Mortgage Solutions and commercial editor at Mortgage Solutions and Specialist Lending Solutions. She has nearly eight years of experience in the B2B publishing market, having previously covered the hospitality, retail, pet, accounting and jewellery sectors.
Shekina has worked for Mortgage Solutions and Specialist Lending Solutions for almost five years. Here, she covers the market’s breaking news stories, engages with professionals in the sector, and oversees any commercially agreed content in partnership with mortgage-related companies.
This includes presenting webinars and hosting roundtable discussions on developing themes in the mortgage sector.
She is an NCTJ-trained journalist and was nominated for the Headline Money Awards Mortgage Journalist of the Year in 2021.
In her spare time, Shekina likes to read, travel, listen to music and socialise with friends.
She currently reports on current events in the mortgage market and liaises with financial clients to produce sponsored content.
Follow her on Twitter at @ShekinaMS