The ‘Don’t Pay’ campaign group calls for Brits to stop paying energy bills. Over 100,000 people have added their names to cancel their direct debits from 1st October.
People need to be fully aware of the implication this can have on any future mortgage borrowing. It would be difficult for lenders to determine lending appetite for customers who simply chose not to pay bills and commitments, when indeed they have the ability to pay.
The majority of ‘high street’ lenders use credit scoring to assess application, any missed payments on utility bills will impact a credit score and have a detrimental impact on an application. Even for lenders who do not credit score, they still assess credit reports and any recent missed payments will usually lead to an application being declined.
If your mortgage is due for review in the near future, we would not recommend missing payments if you are in a position to pay the bill. There will be a lot of people who may not be able to afford the increased bills. Before taking the step of not paying a utility bill it is best to speak to the utility provider first to check what options are available.
The government has introduced a number of schemes to help and there may be other options the provider can offer. If you are struggling with other bills, before falling behind with repayments I would strongly suggest speaking to your providers, including your mortgage lender.