The Government is urging Britons not to move house to reduce the impact of the pandemic
Lenders are giving homeowners a three-month extension to their mortgages so they can move at a later date and avoid spreading coronavirus.
The news comes after the Government warned Britons not to move house in order try and restrict the pandemic.
UK Finance, the body which represents banks in the UK, says lenders have agreed to extend mortgage terms by three months. It will apply to people who have exchanged contracts and agreed completion dates.
Stephen Jones, chief executive of UK Finance, says: "It is clearly not appropriate for people shielding or self-isolating to move home. Therefore where chains contain people in these groups, lenders, conveyancers and other professionals are working together to enable these customers’ moves to be delayed.”
What to do
The three-month extension will make it easier for homeowners to extend their move date.
This could mean extending the date of a current deal or pushing back the start date of a new one.
If you have exchanged contracts, are worried about a looming completion date and want to extend your mortgage offer you should contact your lender.
Lenders have also said they will show understanding if customers' financial circumstances change during this three-month period or the terms of the house purchase change significantly.
Government advice on moving
The Government is urging Britons to stop moving to help stem the tide of the coronavirus outbreak.
It is advising people to delay moving into a new house while the current measures are in place to fight the coronavirus.
In its guidance it says that, while there is no need to pull out of transactions, all parties should try to agree alternative moving dates unless the property is empty.
The advice says: "Our advice is that if you have already exchanged contracts and the property is currently occupied then all parties should work together to agree a delay or another way to resolve this matter.
"If moving is unavoidable for contractual reasons and the parties are unable to reach an agreement to delay, people must follow advice on staying away from others to minimise the spread of the virus.”
Jeremy Leaf, north London estate agent, says: “What we have found is that most people, having made the decision to move, want to hang on in there and see what happens rather than take any dramatic steps to pull out, unless of course they have lost their job or their industry is particularly badly compromised.
“If anything, the need to stay in and sit on their hands is making more people think about moving when the virus is hopefully conquered and our lives are no longer on hold, if the enquiries still coming in are anything to go by.”
With the country on lockdown, there is concern that house prices could fall as the market grinds to a halt.
As a result of the virus, a number of lenders have withdrawn new mortgages to focus on existing customers.
Barclays and Halifax for Intermediaries have both stopped selling mortgages above 60% loan-to-value. This means new customers will need to have at least a 40% deposit or equity in their homes.
Virgin and Skipton Building Society have also suspended all new mortgage applications for house purchases.
Meanwhile, over a third of tracker mortgages were withdrawn when the Bank of England cut the base rate to 0.10%.