7th
Jul 2023
Labour is furious with the government’s decision not to include BTL landlords from the newly introduced Mortgage Charter to help homeowners with increased mortgage interest rates, the party says this exclusion could cause landlords to increase rents to cope with financial pressures.
The Chancellor unveiled the new mortgage charter earlier this week (Wed 28th) which introduces a set of universal standards to help home owners who are suffering from skyrocketing interest rates. Under the terms of the charter homeowners’ will not be forced out by their lenders for at least a year after the first missed payment.
The charter also includes the provision that borrowers whose fixed rate deal is due to end will be offered the option to tie up a new deal up to six months in advance, starting from the 10th July.
But during the House of Commons debate on mortgage and rental costs, Labour’s Shadow Chancellor Rachel Reeves highlighted major issues that could happen if the government continues to exclude BTL mortgage payers from the charter.
She said: “Treasury Ministers remain ignorant or indifferent to the plight of renters. The Tory mortgage bombshell is experienced whether people have a mortgage or not. Renters are seeing huge increases in their rents – on average 10% in the last year. Renters right now are exposed to their landlords passing the higher costs of their mortgages on to their tenants.”
Many of her Labour colleagues supported Reeves’ comments and in particular Derek Twigg MP told the House there is a considerable increase of his constituents telling him they were worried that their landlords may be having to sell up because they cannot afford the mortgage rises.
Chief Secretary to the Treasury, John Glen, failed to respond to the BTL mortgage matter by simply suggesting that over the coming months more lenders would sign up to the charter, he said: “I hope that more and more lenders will be added to those 85% of providers. The details will be known in the next few weeks.”
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