We have summarised the main measures below.
For people who find themselves in financial difficulties because of coronavirus, mortgage lenders will offer at least a three-month mortgage holiday. This holiday extends to buy-to-let landlords.
The FCA announced temporary measures, effective from 14 April, which expect firms providing consumer finance to:
- Offer a temporary payment freeze on loans and credit cards for up to three months, for consumers negatively impacted by Covid-19.
- Allow customers who are negatively impacted by Covid-19 and who already have an arranged overdraft on their main personal current account, up to £500 charged at zero interest for three months.
- Make sure that all overdraft customers are no worse off on price when compared to the prices they were charged before the recent overdraft pricing changes came into force.
- Ensure consumers using any of these temporary payment freeze measures will not have their credit file affected.
FCA consumer guidance is available here.
Private and social landlords will not be able to start proceedings to evict tenants for the period to 30 September 2020.
SSP is currently paid at the rate of £95.85 a week. It is now available to employees from day one, instead of day four, for those who are suffering from the virus or who have been advised to self-isolate. There has been no change in the minimum earnings threshold for SSP (£120 a week in 2020/21).
Self-employed and gig economy workers generally do not qualify for SSP. Instead they may be entitled to Contributory Employment and Support Allowance.
Covid-19 sufferers and self-isolators will be able to claim the benefit from day one instead of day eight. The Minimum Income Floor in Universal Credit (UC) has been temporarily removed to ensure that time off work because of sickness is reflected in benefits.
For 12 months from 6 April 2020, the standard allowance in Universal Credit (UC) and the basic element in Working Tax Credit (WTC) for will be increased by the equivalent of about £20 a week over and above annual uprating (which were to £323.22 per month for UC for age 25 and over and £1,995 a year for WTC for 2020/21). This effectively brings UC into line with the rate of SSP. The change applies to all new and existing UC claimants and to existing WTC claimants.
Housing benefit and the housing element of UC will be increased so that the Local Housing Allowance will cover at least 30% of market rents.
The Chancellor announced in the Budget a £500 million Hardship Fund, which would be distributed to Local Authorities so that they could support the vulnerable.
On 17 April the FCA issued draft guidance on how companies providing motor finance and ‘high cost finance’ (for example, payday loans and pawnbroking) should treat customers. The main proposal is a three-month payment freeze, other than for high cost credit, which would be subject to a one month interest-free payment freeze. The FCA expects to finalise proposals by Friday 24 April 2020, which would come into force shortly afterwards.
Government guidance for employees is here.
Government guidance on claiming benefits is here.
How can we help?
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