Get the free Morning Headlines email for news from our reporters across the world Sign up to our free Morning Headlines email

       Please enter a valid email address

       Please enter a valid email address

       SIGN UP

       I would like to be emailed about offers, events and updates from The Independent. Read our privacy notice

       Thanks for signing up to the

       Morning Headlines email

       {{ #verifyErrors }} {{ message }} {{ /verifyErrors }} {{ ^verifyErrors }} Something went wrong. Please try again later {{ /verifyErrors }}

       As the cost of living continues to rise with wages struggling to keep up, families across the UK are finding it difficult to meet one of their biggest monthly outlays; the mortgage.

       Those homeowners on variable rates, or those who have come to the end of low fixed rates from a few years ago, are likely to have seen a rise in their monthly payments with the cost of borrowing going up.

       Variable rates follow the Bank of England base rate, which in August rose to its highest level since 2008, at 5.25 per cent - meaning the mortgage will be taking a larger chunk of families’ income.

       But what happens when the pressure becomes too much on family finances and the monthly repayment becomes unaffordable?

       There is help is at hand with a number of little-known short-term solutions that are part of a government mortgage charter signed by lenders last year.

       RECOMMENDED

       Boy George says he’s ‘never gonna be friends’ with ‘unfriendly’ Janet Jackson

       Undo

       Trump’s alleged ‘sexual proclivities’ graphically detailed in new Epstein documents

       Undo

       Health Insight Journal

       Neurоpathy Breakthrough: Experts SpeechlessHealth Insight Journal| Sponsored Sponsored

       Undo

       WellnessGuide

       Diabetes Is Not From Sweets! Meet The Number One EnemyWellnessGuide| Sponsored Sponsored

       Undo

       Powered by Taboola Powered by Taboola

       One option opened for repayment mortgage holders is to switch to an interest-only mortgage for up to six months which, as capital is not being paid off, will reduce the amount paid each month.

       Changing a mortgage to interest-free for six months could save thousands of pounds

       " srcset="https://static.independent.co.uk/s3fs-public/thumbnails/image/2009/05/02/14/169502.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/s3fs-public/thumbnails/image/2009/05/02/14/169502.jpg?quality=75&width=640&auto=webp 640w" src="https://static.independent.co.uk/s3fs-public/thumbnails/image/2009/05/02/14/169502.jpg" data-gallery-length="2" class="i-amphtml-fill-content i-amphtml-replaced-content" pinger-seen="true">

       Changing a mortgage to interest-free for six months could save thousands of pounds

       (Getty)

       To be eligible, the account needs to be up to date with payments with no arrears, and it needs to be a residential mortgage, not a buy-to-let. Those who take up the option, by calling up their lender, will face no affordability check and their credit score will not be impacted.

       Promoted stories

       Bill Cruncher

       California Drivers With No DUI's Getting A Pay Day This Month (Check If You Qualify)Bill Cruncher

       Undo

       by Taboola by Taboola

       Sponsored Links Sponsored Links

       Promoted Links Promoted Links

       There is a drawback, however; by switching to an interest-only mortgage for six months, account holders will essentially defer payments on capital which means, if the mortgage lifetime remains the same, monthly repayments will be higher after the six-month term.

       Although, if rates go down, people could be paying less on the remaining borrowed capital.

       An example is if an account holder had ￡200,000 left to pay on a ￡300,000 mortgage with a 25-year term, and was on a rate of 5 per cent, the monthly repayments would go from ￡1,169.18 a month to an interest-only payment of ￡833.33 a month. That’s a saving of ￡335.85 a month, or ￡2,015.10 over six months.

       Another option of support under the charter includes extending the term of a mortgage by six months, or more, to reduce monthly repayments. Again, applicants would face no affordability check and would not have their credit score impacted.

       Announcing the charter in June last, chancellor Jeremy Hunt said the measures gave people a “powerful new tool” to help manage their monthly budges.

       He added: “If you are anxious about the impact on your family finances and you change your mortgage to interest only or you extend the term of your mortgage and you want to go back to your original mortgage deal, within six months, you can do so, no questions asked and no impact on your credit score.”

       Another measure as part of the charter includes lenders being unable to repossess homes within 12 months of a first missed payment. There’s also the option to “lock in” deals six months ahead, although with rates now falling this is now probably not the best option for many.

       More about Homeowners wages Families mortgage cost Level borrowing

       Join our commenting forum Join thought-provoking conversations, follow other Independent readers and see their replies

       3Comments

       1/ 2The little-known mortgage trick that could save hundreds of pounds

       The little-known mortgage trick that could save hundreds of pounds

       Changing a mortgage to interest-free for six months could save thousands of pounds

       Getty

       The little-known mortgage trick that could save hundreds of pounds Interest rate rises could see 1.4 million mortgage holders lose at least a fifth of their disposable income, according to the Institute for Fiscal Studies (Gareth Fuller/PA)

       PA Archive

       CCPA Notice Promoted stories

       YourPennySaver

       US Residents Birthed Before 1976 Now Entitled To These "Ridiculous" Benefits In JanuaryTap to see a list of 24 "legal" ways to get a kickback if you're over 45 and live in the US. Many are stoked to learn theseYourPennySaver| Sponsored Sponsored

       Learn More

       Undo

       Solar Improvements

       California: Do This Instead Of Buying Expensive Solar Panels (It's Genius)Solar Improvements| Sponsored Sponsored

       Undo

       SmartAsset

       Vanguard vs. Fidelity vs. SchwabSmartAsset| Sponsored Sponsored

       Learn More

       Undo

       Read More Comments

       Collapse Comments

       ？ Subscribe to Independent Premium to bookmark this article

       Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.

       Subscribe

       Already subscribed? Log in