On 5 March 2021, the FCA set out proposals to update its January 2021 guidance “Mortgages and Coronavirus: Tailored Support Guidance”. The proposed updates to the earlier guidance are contained in paragraphs 1.2 and section 7 (repossessions). In section 7 the FCA is proposing to introduce updated guidance for firms from 1 April 2021, to ensure that mortgage customers whose homes may be repossessed are treated fairly and appropriately, particularly where there are risks of harm to customers who are vulnerable as a result of the COVID-19 pandemic.
In particular the proposed guidance in section 7 provides that:
- Firms should be mindful of the need for fair and appropriate treatment of customers who may be particularly vulnerable, including as a result of circumstances related to coronavirus. Firms should consider carefully the potential impacts on customers of possession proceedings and consider whether it is appropriate to commence or pursue repossession proceedings, including taking possession, in a particular case at this time. Firms should support and enable customers to disclose their circumstances and consider whether additional care may be required as a result. Firms should ensure that they have appropriate policies and procedures in place for the fair treatment of customers whom the firm understands, or reasonably suspects, to be particularly vulnerable and look closely at the needs of customers with protected characteristics under the Equality Act 2010.
- When considering whether it is fair and reasonable to enforce repossession in a particular case, a firm should consider, and take account of, whether there are any circumstances that may mean a customer, or a member of their household, is at greater risk of harm from coronavirus if they are required to vacate the property. Where the firm is aware of such risks, repossession should not be enforced until those risks have passed or can be appropriately managed. For example, firms should not require customers to vacate the property at a time when they, or a member of their household, are required to self-isolate.
The deadline for comments on the proposals is 10am on 10 March 2021.