MoneySavingExpert.com’s Martin Lewis has warned that it will be a “nightmare year” for some renters with costs rising and said that he is “very worried.”
Lewis said that he expects there will be increased costs for mortgage owners and a rise in arrears for both renters and homeowners.
He said that they rules for renters must be looked at and Lewis told Good Morning Britain that it is “going to be a nightmare year.”
Last Friday the Chancellor Jeremy Hunt met with banks and a new mortgage charter was agreed with lenders who represent around 85% of the market.
Lewis was asked if he believes we will see a rise in repossessions, he said “No, I don’t think we will, for two reasons.
“One, because one of the agreements that was made at the meeting on Friday is banks will not look to repossess, unless the individual wants that to happen, for at least a year from the first missed payment. So there is a little bit of time being bought there.
“And two, because the courts are absolutely clogged up. Even if you started repossession proceedings now, from what I’m hearing it would take 18 months before they were heard.”
He added, “I think we’re going to see some very substantial arrears…
“I think we’re going to see people voluntarily getting rid of their homes.
“I’m very worried for renters out there that they’re not able to afford to pay what they need. And that we really do need to look at what’s going on in the renting situation.”
Lewis warned, “inflation, prices are going up and the economy’s teetering on the brink of recession… And it is a nightmare scenario.
“And it is very difficult for any politician to know what to do. Or me, or you.”
The Money Saving Expert said, “The situation for renters is still one of those untapped, unsolved problems, of course much of that is also from the knock-on to the problems in the mortgage market.”
ITV’s programme asked is there any help for renters who are struggling, he said, “If you feel your rent is being put up in a way that is prohibitive and unfair, absolutely seek advice from a renting adviser, go talk to the local council, many councils will have renting officers, who can help with private rents.”
He warned that landlords who have mortgages on the property they rent out are seeing their rates going up, therefore they are “trying to pass on the cost to the person who’s renting.”
He added, “I welcome the mortgage forbearance measures… it’s not going to help everyone, what I hope it will do is just allow some people to get over the hump.
“I think we need to look at renting, we need to look at the rules for renters because it’s going to be a very difficult period for renters too.”
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