Manage your debts: Payment holidays and your rights explained

I’m worried about managing my debts as I’m on reduced pay at the moment. I’ve heard about mortgage companies offering a payment holiday but what about credit cards and loans? I usually pay every month on time and I’m worried if I miss payments while my income is reduced it will affect my credit rating.

The Financial Conduct Authority (FCA) has confirmed lenders should offer payment holidays on credit cards and loans for three months where a customer’s income has been affected by Covid-19.

This applies to credit cards and most loans, but not peer- to-peer lenders such as ZOPA and RateSetter.

You will need to contact your lender to arrange the holiday and not just stop paying, as stopping payments without informing them may well negatively impact your credit rating.

Arranged payment holidays should not affect your credit rating.

You have until July 14 to apply. Please note the FCA have not said interest should be frozen, therefore it can still be charged and you could end up paying back slightly more overall.

Please contact us at CAB if you want to discuss in more detail as there may also be other debt solutions available.

I claim Carer’s Allowance and Income Support for looking after my mum who lives by herself. However, because of my severe asthma, I have received a letter from the government saying that I should be shielding alone for 12 weeks. What happens to my Carer’s Allowance? Will I have to claim Employment and Support Allowance or Universal Credit instead?

No, you can continue to receive Carer’s Allowance if you are selfisolating and need to stop being a carer for someone else.

However, it sounds like it you should have a benefit check.

This is because of an additional increase in the amount of Universal Credit from April 6.

This now means that people in your circumstances are very likely to be over £ 20 per week better off on Universal Credit over Income Support.

Although some people worry about what moving to Universal Credit will mean, be aware that as a fulltime carer, even after coronavirusrelated restrictions are lifted, you will not have to meet any job-seeking conditions.

I am self-employed and getting Working Tax Credits to top up my income, but I am not getting any work at the moment. I am worried that I will have to stop my claim for

Tax Credits and move on to Universal Credit. I’ve checked and I will be a lot worse off if I have to claim Universal Credit.

As things stand, you don’t have to tell HM Revenue and Customs (HMRC) about short- term changes to your working hours for at least eight weeks. Check with us again towards the end of this time as policy keeps evolving to meet the changing situation.

This applies in your circumstances as someone who is self-employed but having difficulty getting work, and will equally apply to anyone who has been furloughed, or whose hours have been temporarily reduced below the minimum needed to qualify for the benefit, or if someone is too ill to work.

If you are getting no work, you might also want to think about applying to the Self Employment

Income Support Scheme.

HMRC will aim to contact you by mid-May if you are eligible for the scheme, and invite you to claim using the GOV.UK online service.

 Coatbridge Citizens’ Advice Bureau is continuing to provide an advice service via telephone and online.

Call 01236 421447 or email Adviser@coatbridgecab.casonline. org.uk for more information.

Lenders should offer payment holidays on credit cards and loans for three months