What help is available if you face redundancy?
Redundancy is difficult at the best of times, but during the current economic climate of uncertainty and job scarcity, it is even more challenging. For those in this situation, a priority concern will be how to meet everyday living costs and continue mortgage and debt repayments. Fortunately, there is financial help available ...
MORTGAGE REPAYMENTS
Mortgage payment holidays are being extended for homeowners financially affected by the pandemic. Borrowers who have not yet had a mortgage holiday can request from their lender a pause in repayments, that can last up to six months. Those who have had their payments deferred already, can extend their mortgage holiday until they reach the six-month limit. During this period, interest will still accrue on what borrowers owe. The changes form part of a new package of financial support measures announced. Last week, a study by the Joseph Rowntree Foundation found that 1.6 million households - or a fifth of all British mortgage-holders - were worried about paying their mortgage over the next three months. Borrowers who have already reached the maximum six-month mortgage holiday and are still facing difficulty making repayments, are being advised by the FCA to speak to their lender about a tailored support plan. The government says mortgage payment holidays will not be recorded on borrowers’ credit files.
CREDIT CARD AND LOAN REPAYMENTS
Millions of struggling households can now apply for extra support on their loans and debt repayments as a result of the latest coronavirus lockdown measures, the Financial Conduct Authority has announced. This will include payment breaks on loans, credit cards, car finance, rent-to-own, buy-now pay-later, pawnbroking and high-cost short-term credit, the regulator said.
FINANCIAL SUPPORT
Depending on your age and for how long you have been working for your employer, you may be entitled to a redundancy payout. More information about this can be found on the Moneyfacts.co.uk website.
You could also be entitled to government benefits and financial help such as Universal Credit, so you should visit the government website or contact Citizens’ Advice to find out what financial help you can get. For those lucky enough to have savings to fall back on, ensuring you can get quick access to your money is important. Although easy access savings rates are low, it may be worthwhile moving savings held in notice accounts as quickly as possible, as these accounts require a notice period before withdrawing funds.
Money held in a National Savings and Investments (NS&I) premium bond may take a couple of weeks to withdraw, especially if you request this by post, so again, moving funds to an easy access account may be a good option. If your money is locked into a fixed rate bond, there may be the option of withdrawing funds early, but this will likely come with an early withdrawal interest-loss penalty.