FCA updates its guidance on mortgage and consumer credit repossessions

The FCA has updated its guidance to lenders on the treatment of mortgage and consumer credit borrowers experiencing payment difficulties as a result of Covid-19.

In November last year, the FCA said mortgage lenders should not enforce repossessions prior to 31 January 2021 other than in exceptional circumstances. 

In light of the worsening pandemic, this guidance has now been extended so that mortgage providers should not enforce repossessions before 1 April 2021.

For consumer credit firms, however, the current guidance that firms should not terminate a regulated agreement or repossess goods or vehicles except in exceptional circumstances has been softened.

Consumer credit firms will be able repossess goods and vehicles from 31 January 2021, but only “as a last resort, and subject to complying with relevant government public health guidelines and regulations, for example on social distancing and shielding.” 

The FCA also insists that consumer credit firms must consider the impact on customers who may be vulnerable – for example, because of the pandemic – when deciding whether to go ahead with repossessions.

For further details on this or any other compliance related issue, contact a member of our expert team on 01925 765777, or email us at info@ukgigroup.com.

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