Mortgage holidays could be extended to up to a year

The Financial Conduct Authority is reported to be considering offering homeowners up to 12 month’s mortgage holidays.

Currently 1.2m mortgage payment holidays have been offered by lenders to customers impacted by the Coronavirus crisis – that’s equivalent to one in every nine mortgages.

These were expected to be short term.

However The Times this morning says the holidays could be for up to 12 months in a bid to avoid widespread arrears and eventually repossession.

The number of payment holidays currently in place more than tripled in the two weeks between March 25 and April 8 with an average of some 61,000 being granted each day.

For the average mortgage holder, the payment holiday amounts to £260 per month of suspended interest payments, with many benefitting from the option of extending the scheme for up to three months.

Now it appears a longer holiday is on the cards as the virus crisis has further impact on jobs.