"We are proposing to extend payment deferrals for additional support. We also want to make sure no one has their home repossessed during this time."
The FCA is proposing to extend the availability of payment deferrals to support borrowers who are experiencing payment difficulties because of coronavirus.
Under the new rules, those who have not yet had a payment deferral will be eligible for two payment deferrals of up to six months in total.
Those who currently have an initial payment deferral, or who have resumed repayments after an initial payment deferral, will be eligible for another payment deferral of up to three months.
Under the FCA’s proposals, borrowers would have until 31st January 2021 to request a payment deferral.
The FCA says it is working closely with trade bodies and lenders to make sure the enhanced measures "come into effect as soon as possible". It is urging consumers not to contact their lender until the enhanced measures are in place.
The regulator has confirmed that a payment deferral under these proposals would not be reported as missed payments on a borrower’s credit file. However it noted "this does not mean that consumers’ ability to access credit will be unaffected in future, as lenders may take into account a range of information when making lending decisions".
The FCA is also proposing that no one will have their home repossessed without their agreement until after 31st January 2021.
The FCA is asking for comment on the proposals by 10am on Thursday 5th November, with the final guidance published as soon as possible after the comment period closes.
Sheldon Mills, interim executive director of strategy and competition at the FCA, said: "We are working with lenders to ensure enhanced support remains available to borrowers struggling financially following changes in the coronavirus situation across the UK.
"Tailored support will still be offered and remains the most appropriate option for many borrowers, but we are proposing to extend payment deferrals for additional support. We also want to make sure no one has their home repossessed during this time.
"It is in borrowers’ own long-term interest only to take a payment deferral when absolutely necessary. Those that are able to keep paying, should do so. This allows support to be targeted to those most in need.
"We are also asking borrowers not to contact their lender yet, and instead wait for further updates, including from their lenders, soon."
