Chancellor Rachel Reeves met the six largest banks and building societies on 27 March to secure emergency mortgage support, according to the Mortgage Finance Gazette (27 March 2026). The meeting comes as conflict in Iran has driven two-year fixed rates to an average of 5.75% (Moneyfacts, 27 March 2026), forcing borrowers facing renewal to absorb sharp payment increases. The Big Six committed to proactively contact 1.6 million customers whose fixed-rate deals expire by year-end, outlining their options before rates reset.

What the numbers tell you

Here's where this hits your pocket. Borrowers exiting five-year fixed rates and locking into equivalent two-year deals now face annual payment increases of £4,655 on a £250,000 buy-to-let (BTL) mortgage (based on Moneyfacts analysis). That's roughly £388 extra per month. Those reverting to standard variable rates (SVR) face even steeper costs.

The wider context: 86 per cent of all mortgages are currently on fixed rates (Mortgage Finance Gazette, 27 March 2026), meaning most borrowers are cushioned from short-term market swings for now. But as fixed terms mature this year and next, hundreds of thousands will face this same renewal shock.

The Mortgage Charter - what you actually get

The lenders committed to a support framework called the Mortgage Charter. It's not a rate freeze or emergency bailout. It's operational: five concrete options that reduce switching friction and buy time.

First, you can now book new rates six months in advance of your deal expiring. No more last-minute scrambling. Second, you can switch to a new fixed rate with your existing lender without triggering a fresh affordability assessment (also called a "stress test"). That matters if your finances have tightened. Third, temporary breathing space is available: six-month interest-only payment options if you need immediate relief. Fourth, the lenders agreed not to damage your credit score whilst you're discussing support options with them. And fifth, the Treasury pledged to make these options "quick" to access.

Damien Burke, head of regulatory practice at Broadstone, called this "a positive step" for borrower understanding, though he flagged an operational reality: contacting 1.6 million customers efficiently is a genuine logistics challenge for the lenders.

What happens next

The agreement is voluntary. The lenders committed these measures publicly, and the Treasury's emphasis on speed suggests they want contact to happen well before deals expire, giving borrowers time to act.

For investors with fixed rates renewing between now and end of 2026, it's worth knowing these options exist before your lender makes contact. You may wish to model what new rates will cost you now, rather than waiting. If you're stretched, the interest-only option may buy breathing room - speaking to your broker about whether that's appropriate for your situation is a sensible step. It's also worth asking your existing lender whether switching without a fresh affordability assessment (also called a "stress test") is available to you, given lenders may apply discretion.

The Chancellor's intervention signals that borrower strain is real enough to require government-coordinated action. The lenders' compliance suggests they understand that too. But the Mortgage Charter is a harm-reduction tool, not a solution. Rates remain elevated. Payment shocks remain likely. What's changed is the friction to accessing support options.