We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

mortgage payment holidays

Can anyone explain to me about mortgage payment holidays? My ex has dropped child maintenance payments due to job loss and I am struggling. Going to ask the RBS for options and thought this might help in the meantime.

Have been with them three years and have a good payment record. Need to know what I am talking about??

Comments

  • MarkyMarkD
    MarkyMarkD Posts: 9,912 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Many lenders will allow you to take a payment holiday. A payment holiday actually means that the payment you would normally make is added to the capital of your loan, and therefore that you'll pay more every month over the remaining term of the mortgage.

    Lenders are getting less keen to allow payment holidays - particularly where borrowers are paying very low rates! Expect them to require a reason, or to simply say no. You have no rights to expect a payment holiday, in most cases.
  • lazlo
    lazlo Posts: 7 Forumite
    Rang RBS and they said that I could have a six month at only half the mortgage cost or 3 month mortgage break to tide me over this difficult period but that I would then have a bad credit rating which would affect me for 6 years so its nice to know RBS are a caring bank. I have no choice really but to sell my home!!
  • MarkyMarkD
    MarkyMarkD Posts: 9,912 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    They need to be clearer about what they are offering.

    A payment break does not affect your credit rating, because the lender is granting you a holiday from your payments.

    The only way it would lead to a bad credit rating is if it was an arrangement (i.e. a debt arrangement to deal with arrears) rather than a payment break. It sounds like this is what they are offering, rather than a payment break, but they shouldn't attempt to confuse you about the difference.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    lazlo wrote: »
    Rang RBS and they said that I could have a six month at only half the mortgage cost or 3 month mortgage break to tide me over this difficult period but that I would then have a bad credit rating which would affect me for 6 years so its nice to know RBS are a caring bank. I have no choice really but to sell my home!!
    With the greatest respect, they are not a charity.

    They have given you an option to pay less and explained the consequences of this - which is simply that your underpayments will be honestly reported on your credit file.

    It may well be at a time when the value of your home and the size of your mortgage are uncomfortably close to each other from the lender's perspective, increasing the risk of them losing money.

    Have you made sure you and your ex are claiming any tax credits / benefits that you're entitled to?
  • lazlo
    lazlo Posts: 7 Forumite
    With respect I know they are not a charity but the LTV is 29% so there is a sizable equity in the property of £100,00.00 yet everything is in black and white and the answer is NO whatever the circumstances.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    lazlo wrote: »
    With respect I know they are not a charity but the LTV is 29% so there is a sizable equity in the property of £100,00.00 yet everything is in black and white and the answer is NO whatever the circumstances.
    In that case I think they should show more fleixibility!
  • MarkyMarkD
    MarkyMarkD Posts: 9,912 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    But they ARE being flexible. They are allowing you to make an arrangement to pay less than your contractual payment, but then they are going to correctly report on your credit status report that you were unable to meet your contractual payments.

    What exactly is misleading about that?
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 348.2K Banking & Borrowing
  • 252.1K Reduce Debt & Boost Income
  • 452.3K Spending & Discounts
  • 240.7K Work, Benefits & Business
  • 617K Mortgages, Homes & Bills
  • 175.6K Life & Family
  • 253.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.