Financial help: Creditors’ responses to coronavirus
These are uncertain times for all of us. Naturally, we're all worried about our health, but many of us also have growing money worries.
However, payment holidays for credit cards, new overdraft rules and laws to protect people struggling to pay their rent are just some of the measures introduced to provide financial help during the coronavirus outbreak.
If you’re worried about your debts and how you’ll be able to pay them, we’re here to support you. Together, we can work out a plan to get you through this difficult time. Find out more about how we can help you.
If you’ve been affected by coronavirus, it’s a good idea to make a budget so you can get a clear picture of your new financial situation. Then, contact your creditors to discuss the options available to you.
UPDATE: Government legislation re: bailiff home visits in England and Wales
From 23 August, bailiffs in England and Wales can resume visits to people's homes in order to collect goods towards debts owed.
If you've been contacted by a bailiff, and you're worried about a potential home visit from 23 August, please get in touch with us.
At present, home visits from sheriff officers in Scotland are on hold until further notice.
Here, we explain what creditors are doing to support their customers through the coronavirus crisis if you:
- Can't afford your mortgage payment
- Can't pay your rent
- Can't pay your credit card bill
- Need to use your overdraft to get by
- Are going to miss a car payment
- Can't make your payday loan repayment
- Will miss your buy-now, pay-later repayment
- Can't afford your personal loan payments
- Can't pay your household bills
- Can't pay your mobile phone bill
- Are worried about what happens after a payment holiday
If you’re worried about money, don’t wait to get help. Call us on 0800 138 1111 (Monday-Friday 8am-8pm, Saturday 8am-4pm) or use our debt advice tool 24/7.
1. I can’t afford my mortgage payment
Many people have been left struggling to pay their mortgage after the impacts of coronavirus caused their circumstances to change. If you’re worried about paying your mortgage, help is available.
Help with mortgage payments
Creditors are helping to support their customers who are struggling to make their mortgage payments due to coronavirus. However, it’s important to be aware that the options available to you depend on whether your account was up to date before the crisis began.
Before coronavirus my mortgage payments were up to date
All creditors are offering three-month payment holidays for customers affected by coronavirus, if they were up to date with their payments beforehand.
I had mortgage arrears before coronavirus
The mortgage support available from creditors varies for customers who were already in arrears. If you were already behind with your mortgage payments before the effects of coronavirus, you should contact your creditor as soon as possible to discuss your options.
2. I can’t afford to pay my rent
If you rent your property but you’re struggling to pay your landlord, help is available throughout the UK. However, the laws put in place to protect tenants vary depending on where you live.
Help for tenants in England and Wales
The Government has introduced the following new laws to help protect renters during the coronavirus crisis:
- Landlords must give all renters three months’ notice if they want to end the tenancy
- No court processes can start until the three-month notice period is complete
- All housing possession action has been frozen
- No one can be evicted
These laws will be in place until at least the end of July 2020. They’ll then be reviewed and extended if needed.
I rent in Scotland – what help is available?
If you live in Scotland and you’re struggling to pay your rent because of coronavirus, you’ll now have up to six months to pay any rent arrears.
The Scottish government has also launched a scheme to offer interest-free loans to private landlords whose tenants are having difficulty paying rent during the coronavirus crisis.
I rent in Northern Ireland – what help is available?
If you rent property in Northern Ireland, the above points also apply to you, as well as:
- Tenants of social housing – the NIHE and housing associations have committed to not evicting anyone during the outbreak
- Private tenants – landlords must give 12 weeks’ notice to quit before they can start possession proceedings. Possession claims are deemed ‘non-urgent’ by the courts and are therefore unlikely to go ahead
Universal Credit and rent arrears
The DWP has suspended certain deductions from Universal Credit (UC). If you have a suspended possession order (SPO) and normally have rent arrears deducted from your UC, you will need to make your rent arrears payment directly. If you’re unable to do this for any reason, contact us immediately, as not paying may lead to your breaching your SPO, and put you at risk of eviction.
3. I can’t afford to pay my credit card
If you’re struggling to make your usual monthly credit card payment due to coronavirus, there are a number of ways creditors may be able to help you.
Help with credit card debt
To support customers who are struggling with their finances, creditors may be able to help by:
- Offering credit card payment holidays for up to three months
- Ensuring your credit rating won’t be affected if you use a payment holiday
- Increasing credit card limits – it’s important to consider the longer-term impact this could have on your credit file. Be aware that if you’re on a debt solution, taking out extra credit could go against the terms of your agreement. Always speak to your debt solution provider before considering this as an option
What if I’ve received a ‘persistent debt’ letter?
If you have a persistent debt that your credit provider's asked you to increase your payments on, the Financial Conduct Authority (FCA) has relaxed these rules for the time being.
The deadline for customers to respond to persistent debt letters has been extended until 1 October 2020. They've also been given more time to increase payments on any persistent debt.