Lenders have given over 1.6 million mortgage payment holidays to support customers facing financial difficulties due to coronavirus, UK Finance has revealed.

The figures, to April 20th, show one in seven mortgages are now covered by payment holidays following steps taken by lenders to help households whose finances have been affected by the Covid-19 crisis.

For the average mortgage holder, the payment holiday amounts to £755 per month of suspended payments.

Lenders continue to offer product transfers enabling existing customers who come to the end of a fixed term product, and meet eligibility criteria, to move to a new deal.

Normally customers on payment holidays would not qualify for a product transfer, but given the current exceptional circumstances lenders are waiving this rule to help borrowers impacted by Covid-19.

Product transfers are for like-for-like mortgages and tend not to require a new affordability assessment, meaning existing borrowers who have been furloughed will also be eligible.

Over one third of all payment holidays approved so far were done so between 25 March and 1 April.

Kate Davies, Executive Director of the Intermediary Mortgage Lenders Association (IMLA), commented:

“This agreement builds on the commitment made by lenders in July 2018 to contact customers who are coming to the end of a mortgage deal and discuss what alternative options might be available.

“It offers additional – and no doubt welcome – reassurance that customers will not be penalised if they have sought an approved payment holiday during this difficult period.”

Mortgage borrowers whose financial situation has been affected by Covid-19 are advised to contact their lender to discuss whether they are eligible for a mortgage payment holiday and if it is the best option for them.

Those requiring this support will need to self-certify that their income has been either directly or indirectly impacted by the coronavirus.

Lenders are also urging mortgage holders not to cancel their direct debits before a payment holiday has been agreed, as this will be counted as a missed payment and could impact their credit file.