To ask His Majesty's Government what steps they are taking to support homeowners with rising mortgage rates.
8 November 2022
Around 75% of residential mortgage borrowers are on fixed-rate deals and are therefore shielded from interest rate rises in the short term. It is also worth noting that lenders are required to stress test all new prospective borrowers’ ability to continue repaying their mortgage under higher interest rates.
However, the Government has already taken immediate action to help households through the Energy Price Guarantee and the Energy Bills Support Scheme. This is in addition to the £37 billion of targeted support for the cost of living this financial year.
When mortgage borrowers are in financial difficulty and struggling to pay their mortgage, Financial Conduct Authority guidance requires firms to provide support through tailored forbearance options. The Government has also taken a number of measures aimed at helping people to avoid repossession, including Support for Mortgage Interest loans for those in receipt of an income-related benefit, and protection in the courts through the Pre-Action Protocol, which makes it clear that repossession must always be the last resort for lenders.