Time is running out to apply for a mortgage payment holiday

If, like many of us, your household income has been affected by Covid you can still apply to your lender for a mortgage payment holiday – but don’t delay – the deadline is Wednesday 31st March 2021. The worst thing you can do if you are struggling to make payments is to bury your head in the sand. Covid has affected millions and there is no shame in asking for a hand at this time. Lenders are ready and willing to help and the feedback we’ve had is that they have made the process easy and the decisions as quickly as they can. 1.8 million payment holidays were taken at the height of the first lockdown, so you are not alone! Generally, lenders will offer you a three-month payment freeze. Remember that you will still owe the interest on the loan during this period and when your monthly payments resume, they will be higher than before so ask your lender for confirmation. If you can make partial payments this would help. After the three-month period you can resume your payments or ask to extend until you reach the 6-month limit. If you still need help after a six-month payment holiday, your lenders should work with you to offer you additional support. This could include:

  • another payment deferral
  • another period of reduced payments
  • an extension to your mortgage term
  • a change to your mortgage type

Support after the six-month period could impact your credit score. Payment holidays are also available on other borrowing options and finance agreements, including:

  • personal loans and credit cards
  • insurance
  • car finance

Hopefully, we are over the worst now but its good to know there is help out there if you need it. Please do get in touch if you want to discuss your options, we’d be happy to try and help. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT

<a href="https://mortgageyard.co.uk/author/kate/" target="_self">Kate Kravis</a>

Kate Kravis

Hi there, I'm Kate and am part of the Mortgage Yard team based in Taunton.
February 28, 2021