The Financial Conduct Authority (FCA) has published guidance for mortgage firms to help customers worried about or already struggling with their mortgage payments as a result of the cost of living crisis.

The draft guidance sets out options firms can use to support their customers to manage their monthly mortgage payments, alongside new information for borrowers affected by rising prices.

It also highlights the flexibility firms have to support customers who have missed monthly mortgage payments or are worried they may not be able to make payments in future. 

In addition, the guidance covers options such as extending the term of their mortgage, switching to interest-only for a temporary period, moving to a different interest rate or making reduced monthly payments for a temporary period.

The authority says that making changes “may result in higher monthly payments in future or paying back more overall”. 

“Mortgage borrowers should consider carefully any steps they take and customers who can keep up with their payments should continue to do so,” it adds. 

The FCA has also attended a roundtable, hosted by the UK government, alongside mortgage lenders to discuss what support some mortgage borrowers may need.

It says it’s “closely monitoring the mortgage market and will continue to act so consumers get the support they need”.

FCA executive director of consumers and competition Sheldon Mills states: “Most borrowers are able to keep up with their mortgage payments and should continue to do so. But if you’re struggling to pay your mortgage, or are worried you might, you don’t need to struggle alone.”

“Your lender has a range of tools available to help, so you should contact them as soon as possible.”