"While some individuals have been able to save additional disposable income because of the lack of opportunity to socialise or attend social events, others have struggled with job insecurity and the financial strain of supporting loved ones.
"Crucially though, there have been government-led support measures in place, such as the payment deferral scheme, which helped many people to manage their mortgage repayments through this difficult period."
Mr Kennedy agrees there have been some government initiatives, such as payment deferrals or the Coronavirus Job Retention Scheme that have helped.
However, he warns: "The indiscriminate nature of Covid-19 means vulnerability can exist across all sectors of our customer base and we assess everyone’s circumstances on an individual basis, regardless of product type.
“A lot of this vulnerability is due to the interconnected nature of the market. For example, in some cases rent arrears have impacted customers’ ability to pay their residential or buy-to-let mortgages (or both)."
And there are other issues on the horizon when the support schemes fall away. Mr Murphy states: "Residential borrowers have received well-publicised support from the government, with the most prominent being payment holidays for those who have found themselves financially vulnerable because of the pandemic and the associated restrictions."
This, alongside furlough and various other income schemes, should mean residential borrowers are very well protected at present. Moreover, the swathe of job cuts witnessed in 2020 seems to have evened out – for the time being, at least.
But Mr Murphy warns: "One issue we are seeing is that some borrowers may have abused the payment holiday scheme by taking one when not required. Many may not have appreciated the full terms of the holiday and could now be lumped with higher payments due to the interest accrued during the break.
"We may also begin to see further issues down the line – while government rules state that payment holidays cannot impact a borrower’s credit score, they have acknowledged that the holidays will still be considered in future lending applications. It will be vital that borrowers in this situation are using an experienced broker."
Tenants
Often left out of the equation are tenants, but while these may not be mortgage clients, they may well be clients with wealth management and pension needs who, because of the pandemic, are now finding it harder to make ends meet due to unexpected unemployment or a severe reduction in their hours.
After all, the vast majority of tenants are hard-working individuals and the vast majority of landlords are decent businessmen and women. Both sides need support in an unprecedented pandemic situation, the likes of which have not been seen in living memory.
