The Mortgage Charter and Divorce – Why Early Advice is Crucial

The Mortgage Charter and Divorce – Why Early Advice is Crucial

The Mortgage Charter agreed between the Financial Conduct Authority (FCA) and the major UK mortgage lenders in June 2023, continues to offer some relief to those struggling with mortgage repayments due to the cost-of-living crisis and within the context of divorce and separation. The Charter includes rules that can provide temporary assistance, such as:

• not to force a borrower to leave their home without their consent, unless in exceptional circumstances, in less than a year from their first missed payment
   
• to allow customers to lock in a new deal up to 6 months ahead of the end of a fixed rate deal, and to request a better like-for-like deal up until the new one starts, if one is available
   
• without assessing affordability, to permit customers who are up to date with their payments to switch to interest-only payments for 6 months, or to extend their mortgage term with the option to revert to their original term within 6 months

However, it's important to note that these options are not mandatory and are at the discretion of the lender. Additionally, some measures, like switching to interest-only payments, are only available for a limited period (e.g., 6 months).

Why Early Advice is Crucial

If you are considering separation or divorce, it is essential to gather all relevant mortgage information and consult with a divorce lawyer as soon as possible. Early advice can help you understand your options and make informed decisions about your divorce and financial future.

How We Can Help

At Parachute Law we specialise in providing comprehensive legal advice and support during divorce proceedings.

Every divorce case is unique. We provide personalised legal advice to ensure your financial interests are protected.

The key takeaway for anyone considering separation and divorce is to seek early advice. Understanding your mortgage options and having a clear plan can make a significant difference to your financial settlement. Contact us today to schedule a consultation and take the first step towards securing your financial future.