Mortgage arrears: RBS offers 6-month grace period

The Royal Bank of Scotland (RBS) has promised to give at least six months’ ‘breathing space’ to homeowners who have fallen behind on their mortgage payments.

Britain’s fifth-largest mortgage lender, with around 7% of the mortgage market, RBS is offering double the three-month ‘grace period’ which the banks agreed with Chancellor Alistair Darling last week.

Under the new agreement, RBS wouldn’t begin repossession proceedings against a homeowner unless they were at least six months in arrears.

According to the Council of Mortgage Lenders (CML), 1.44% of mortgages were at least three months in arrears at the end of September. An increase on June’s figure of 1.33%, this represents 168,000 cases.

As the CML reports, buy-to-let (BTL) mortgages have been hit much harder than the rest of the mortgage market, with the percentage of BTL mortgages in arrears rising from 1.10% at the end of June to 1.58% at the end of September.

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Tags: mortgage, mortgages, grace period, buy to let, buy to let mortgage, arrears, mortgage arrears

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