A lifeline for borrowers facing difficulties with their monthly repayments
Chancellor of the Exchequer Rachel Reeves recently held talks with the UK’s six largest banks and building societies to support borrowers who could be affected by the current Middle East conflict. Fixed-rate mortgages increased in cost during March, with the average mortgage rate rising from 4.89% at the start of the month to 5.50%.
Those borrowers currently on a fixed rate will not see any immediate change, and it is estimated that about 86% of homeowners are in this secure group. However, over one million homeowners whose deals expire in the coming months will likely face higher repayments as these rate rises come into effect.
Proactive contact from major lenders
In response to these financial pressures, the Chancellor and the Economic Secretary brought together the largest financial institutions and secured a strong commitment. These lenders will now proactively contact 1.6 million customers whose fixed-rate deals expire between now and the end of the year.
Financial providers have been clearly instructed to outline customer options or explain how they can access tailored support well before any payment adjustments occur. The Chancellor has also emphasised that the existing Mortgage Charter can offer a lifeline to borrowers struggling with their monthly repayments.
Understanding the Mortgage Charter
Created during the height of the recent mortgage crisis, the Mortgage Charter aims to offer practical support to customers facing payment difficulties. Under this agreement, lenders must provide flexible options, including a temporary switch to interest-only payments to ease immediate financial pressure.
Importantly, the scheme also allows customers to reserve a new rate up to 6 months in advance. Borrowers can switch to a different deal with their existing lender without needing a new affordability assessment. Chancellor of the Exchequer Rachel Reeves pointed out that in uncertain times, people require clear reassurance and practical support without concern over their credit score being impacted.
Industry support and expert advice
Rather than introducing a completely new support package, this initiative seeks to enhance the current framework by offering clearer notice, more preparation time, and a simpler, more accessible route to existing support. The goal is to make the process less intimidating and more transparent for those needing assistance. Key features of this support include the ability to secure a rate up to six months in advance, switch to a like-for-like deal, or discuss options for short-term breathing space to help manage financial pressures.
For individuals feeling anxious about moving onto a higher rate in 2026, it’s especially important to take proactive steps early. Waiting until an existing deal expires can limit options and increase stress, while starting the process sooner allows for better planning, greater flexibility, and a smoother transition. This approach highlights the value of early engagement and preparation, helping individuals to make informed decisions and access the support they need when they need it most.
Taking control of your finances
The six-month point is a crucial moment for action. By this time, borrowers should review what their current lender offers, compare it with other options on the market, and determine the exact new monthly payment in real financial terms. Many people focus only on the interest rate, but the most important factor is whether the new monthly payment remains manageable alongside daily living costs.
It is advisable to discuss your options with us early in the process. We can help you understand your options in advance and estimate your potential payments before you face pressure, giving you the opportunity to find an alternative mortgage solution.
Worried about rising mortgage repayments?
If your fixed-rate deal is ending soon and you’re worried about higher payments, contact IMC Financial Services on 020 8392 6111 or email info@imcfs.co.uk for support and guidance before rates change.