Payment holidays

Andy5678

Are the FCA likely to enforce credit cards and loan companies to extend payment holidays even if people have already had 6 month breaks last year?

MattMattMattUK

No one knows for sure, but the best guess, based on current information would be no. Payment holidays were designed to give breathing space, now that has happened, if people are still in difficulty that is likely to be an ongoing, perhaps permanent situation so allowing payments to be postponed and interest to accumulate is not a sensible choice. 

Anyone still struggling to pay is now encouraged to contact their lender and agree a payment plan, this will likely mean that the account is registered as in default for a card, but with little or no interest being accrued and for mortgages some providers are allowing borrowers to move to interest only mortgage deals.

Andy5678

Thanks, I'm really hoping they do something though. Both myself and my partner were made redundant from jobs in the hospitality industry in July and haven't worked since. The small amount of Universal Credit we get just about covers our main bills and food for the month, there's nothing left to pay the monthly credit card and loan repayments we need to make and with a new lockdown in place no chance of getting a new job anytime soon. Surely something has to be done?

Thrugelmir

Andy5678 said:

 Surely something has to be done?

Head to the Debt Free Wannabe board.  You need broader advice as to how to address your financial woes. Payment holidays may simply compound the underlying problems further. 

MattMattMattUK

Andy5678 said:

Surely something has to be done?

Not really, a lot of people have had little or no help. Personally my income has fallen by around 90% this year, but I am eligible for almost nothing, that is just the way things have gone.

Have you applied for jobs in other sectors? My friends in hospitality and other sectors similarly hit (Film, TV, Theatre, etc.) all took jobs working in supermarkets, healthcare settings, as delivery drivers etc.

Are you renting or a home owner? As a renter your UC would normally still leave you with a some leftover after bills, food etc. Have you cut everything else back to the bone? For homeowners there is less help unfortunately as they get no contribution towards mortgages or mortgage interest, where as if they were a renter in the same position they would get several hundred per month. Have you checked a benefit calculator such as Entitled To, to make sure you are claiming the maximum? https://www.entitledto.co.uk/

You also need to look at what the loans are for, if they are for car finance can you end the deal, items you can sell which you can use the funds to reduce the debt etc. Unfortunately we are in a recession that will impact us for many years to come, that means that many have to face adverse conditions and some will have a rough time of it, the same happened in every other recession and this one will be no different. 

poppy12345

Andy5678 said:

The small amount of Universal Credit we get just about covers our main bills and food for the month, there's nothing left to pay the monthly credit card and loan repayments we need to make and with a new lockdown in place no chance of getting a new job anytime soon. Surely something has to be done?

 Welcome to the life of benefits. There's going to be a lot of people that won't be so quick to judge those living on benefits. It's not easy. I agree with the advice to head across to the debt free wannabe thread.

mattyprice4004

No chance of getting a job? Maybe it's just here, but supermarkets and other essential businesses are screaming for staff.

A friend of mine was a pub manager, now he's a supervisor in Sainsburys and he quite literally walked into the job.