The Financial Conduct Authority (FCA) has released details of the next stage of support for mortgage borrowers facing COVID-19 related payment difficulties. 

The authority’s new guidance means lenders will prioritise support for borrowers who face the greatest difficulties or are at most risk of harm. 

The latest guidance will be of interest to anybody who has had to defer mortgage payments and take a ‘payment holiday’ over the past few months due to COVID-19 related financial problems. On the contractor and freelancer side, this guidance will be of particular interest to workers who have struggled to secure work during the pandemic and as a result, may have had to defer mortgage payments. 

The guidance helps to ensure support and guidance will still be delivered, even after their payment holiday ends.

It also means firms should deliver outcomes on the basis of an individual borrower and an individual case. This is to prevent companies adopting a ‘one size fits all’ model which could neglect or not be favourable for some vulnerable borrowers. 

Lenders will also be required to guide borrowers to the best sources of financial management, such as money guidance, debt advice or through self-help resources. 

To ensure firms adhere to this guidance, the FCA will be monitoring firms and lenders to make sure borrowers are treated fairly.

This is the latest set of FCA-issued guidance related to mortgage payments and the COVID-19 pandemic. In June, the FCA enabled borrowers affected by COVID-19 to take a first or second three-month payment deferral until 31 October 2020. From 16 September onwards however, the guidance will shift to the newly updated version, with a more subjective take on mortgage payment situations tailored to those who need help most. 

On the business side of things, the FCA has also released guidance for companies still facing financial difficulties, or companies who may be newly affected by coronavirus after the current guidance ends. 

The FCA has stated that its guidance is under continuous review and that if circumstances change significantly, such as a damaging second wave for example, then further measures will be considered. 

The full FCA guidance can be accessed here.