Mortgage customers whose deals will shortly be ending can now negotiate a product transfer with their lender - even if they’ve successfully applied for a payment holiday during the Covid-19 lockdown.
UK Finance has said that ‘current exceptional circumstances’ are the reason for introducing the new measures, which could affect up to one million customers who are set to reach the end of their fixed-rate deal between now and the end of 2020.
Customers will only be eligible for a product transfer if they are approaching the end of their current fixed-rate deal, aren’t looking to borrow more, and are up to date with their
payments. Lenders will contact their eligible clients around the time when their term is due to end.
Stephen Jones, chief executive of UK Finance, said: “Lenders understand that many
households are seeing their finances squeezed due to the coronavirus pandemic and we are working hard to help customers get through these tough times.
“The industry has acted quickly to support homeowners through this crisis and has taken
decisive steps to ensure that eligible customers on payment holidays due to Covid-19 can
opt for the security of fixing their monthly mortgage payments going forward.
“There is a range of support available to mortgage holders concerned about their finances.
We would encourage any homeowners impacted by coronavirus to visit their lender’s
website in the first instance to find out more information and how to apply.”
Following an agreement between UK Finance, the Building Societies Association (BSA) and
the Intermediary Mortgage Lenders Association (IMLA) which came into play in 2018,
lenders typically offer product transfers to eligible customers who are coming to the end of a fixed-rate deal.