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Don't Pay UK and mortgages

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 09. August 2022

Looking to speak to mortgage brokers about the Don't Pay Group and their pledge to cancel their direct debits from 1 October when the energy price cap is set to increase. 

  1. What might the impact of this be on mortgage affordability?
  2. Have you had customers say that they were part of this lobby group? What has your advice been to them?
  3. Have you had customers approach you with concerns about the rising cost of living/energy cap increase? What has your advice been?

 

8 responses from the Newspage community

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Editor
Rob Peters
Principal at Simple Fast Mortgage
Groups such as Don't Pay are created by fools and anarchists who have zero regard for the welfare of the people they use to push their agenda of social disruption. They just want to see the world burn, albeit not by gas fire.
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Imran Hussain
Director at Harmony Financial Services
Anyone considering not paying a utility bill on time and considering purchasing a home within the next few years may as well forget about it, especially if they have a small deposit. As the market tightens, any blips on credit files will impact who will actually lend and also it's a slippery slope as all it takes is a few missed payments to end up with a default or CCJ. Then it's curtains for your credit score. I have spoken to many clients who like myself are concerned about rising energy prices and other utilities and I say have a proper review of your outgoings as personally me having coffee at home saves me £200 a month and I will also be cancelling subscription services I no longer use i.e Netflix etc but ensuring I keep my mortgage, utility and protection policies in place.
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Adam Hosker
Chief Technology Officer (CTO) at Cyborg Finance
Anyone taking part in this particular internet challenge will be swinging a wrecking ball at their credit scores and potentially pay for it it for years to come. There are other ways to cut household expenditure that don't trash your future when it comes to securing a mortgage or taking out other forms of credit and debt.
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
To anyone considering this my honest advice is, please, please don't. We're all feeling the pinch with the runaway cost of living crisis being ignored by the government but getting a default or a CCJ and knackering your credit score isn't the way to solve it. You may find it harder to get a mortgage in future and even if you can it may be with an adverse lender where you have to pay hundreds of pounds over the odds every month, leaving you significantly worse off in the long run. If you opt for Don't Pay, you will eventually pay - through the roof.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
Whilst I can understand the sentiment, this really is something that will end up doing those involved more harm than good in the long run. The impact of missed payments, a default, or County Court Judgment will result in access to credit, such as loans, car finance, credit cards and mortgages, being damaged for years to come. This will mean a struggle to get credit in some cases, or at least a significant increase in the rates being offered at best. Your credit file looks over a six-year period, so we are talking about the ramifications of these actions haunting your credit profile for a long time.
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Jamie Lennox
Director at Dimora Mortgages
We completely understand many people's frustrations around the rapid rise of energy bills, but not paying your energy bills is not the answer on an individual basis. Payment history to utility companies feeds into the credit reference agencies, so we will see this impacting people's credit reports which will stay on their file for up to six years. Something so trivial could see customers being rejected for credit or the debt they do manage to secure being far more expensive. Not maying your energy bills may feel like a moral stand but it could prove a disaster for your credit score.
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Jonathan Burridge
Founding Adviser at We Are Money
Just don't do it. It is the most ill-thought consumer protest I can remember hearing of. The only outcome will be to the detrimental of those that sign up. It is the credit profile equivalent of gluing yourself to a motorway.
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Paul Neal
Mortgages & Equity Release Advisor at First Choice Financial Services
This for me is up there with taking out an IVA: the impact on your credit score is very detrimental. Any mortgage lender wants to see you are reliable and able to keep up your payments when applying for a mortgage, so a single missed payment can take you straight out of a good interest rate and potentially cost you thousands on interest. My advice is simple: don't do it.