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FCA Mortgage Charter uptake data: "The Mortgage Charter has really only kicked the can down the road"

ended 12. June 2024

The FCA has published data showing uptake of the Mortgage Charter, suggesting that a minimum of around 1.1 million mortgages benefited from one or more of the options set out in the Charter, whether explicitly or through a business-as-usual channel; and that around 113,000 mortgages have temporarily reduced monthly payments via the new FCA rules. Full report >> here <<. Newspage asked brokers for their views, below.

6 responses from the Newspage community

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Andrew Montlake
Managing Director at Coreco
That over a million mortgage holders have used the Mortgage Charter in some form or other shows the significant pressure many borrowers are under. The cost of living crisis and rising rates have brought the hammer down on many households, and you fear that repossession numbers will increase in the months ahead. The Bank of England needs to act and it has the chance to do so next week.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
These stats show the huge scale of the support households have needed to keep the wolves from the door during the cost of living crisis and as rates rose. Sadly however, the charter only offers short-term reprieves and many of these borrowers will still have a lot of challenges when it comes to paying back the support after the arrangements come to an end. I feel we have not seen the worst of the insolvencies and repossessions yet, as the Mortgage Charter has really only kicked the can down the road.
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Adam Stiles
Managing Director at Helix Financial Partners
The Mortgage Charter remains a very relevant and useful safety net for a huge number of people who are suffering from the cost of living crisis. We hope it will remain a permanent fixture as a it's a great tool to help those who are struggling.
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Elliott Culley
Director at Switch Mortgage Finance
When the Mortgage Charter came into force, it offered many borrowers a lifeline against what was a sudden and painful rise in mortgage costs. It's clear this has helped many borrowers in the short term, as over 1.1 million mortgages were amended as a result of the charter. The early data shows repossessions were low, which was one of the charter's main aims. However, rates remain high and the worry remains that the charter was more a stop gap solution and that some of the borrowers that made use of it may be in trouble further down the line, when unfortunately this support ends.
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Riz Malik
Independent Financial Adviser at R3 Wealth
One question we should ask ourselves is who benefits the most from the Mortgage Charter. You may think it is the borrower but ultimately it is the lenders, most of whom have already posted record profits. Those who think they benefited from it may be in for a nasty shock.
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Ben Perks
Managing Director at Orchard Financial Advisers
The Mortgage Charter has supported many borrowers in their time of need. But the grace period will soon be over and people will have to revert to their normal mortgage terms. For some, the respite period will have enabled them to prepare. But for many, I expect we will see a sharp increase in arrears and repossessions. It’s troubling data.