Mortgage break - maternity leave? Advice needed please

pirate26

Hi all,

My husband and I bought out (first) house under the Homebuy Scheme (as we had a low deposit) in May 2010. We have a fixed-rate mortgage with Halifax.

I was hoping for some advice as our first baby is due next spring. After working out our finances we decided to apply for a 'mortgage payment holiday' with Halifax to enable me to remain at home with our baby for a longer period (we both work full time). However when we enquired about this we were informed that we weren't eligible due to our 'shared ownership' mortgage. Although this term is not mentioned anywhere on our paperwork/statements, I can appreciate that this is how we are considered, due to the Homebuy Scheme.

We are planning to request an appointment with a branch advisor to further discuss our options, but I am posting here in order to prepare for this. What we would like to know is:

- as we have never missed a mortgage payment, would it be worth asking Halifax if they would reconsider our eligibility for a payment holiday on the grounds of maternity leave?

- if not; would it be appropriate to attend the branch appointment with a set figure of an amount we could afford to pay towards our mortgage during that six-month period (we would be able to pay something; but wouldn't reach our usual payment figure while in receipt of statutory maternity pay)? If so, would this have any effect in the future?

I suppose I'm thinking that seeing as we are giving Halifax advance notice of our circumstances and we are willing to negotiate with them, it seems a little unfair for them to flat out refuse to accept anything other than our normal payment. However if this is the likely scenario please warn me now!

Thanks in advance

minority

Hi

Since you entered into a fix term mortgage I would think it very unlikely that you will get any beneficial treatment as you signed up to the fix rate for a set period with both parties knowing that you had a fixed amount to pay over that period.

I too am in the position where my gf is on maternity pay while paying our fixed rate mortgage however we have always overpaid our mortgage by half the monthly amount for last 4 years so if we needed a break we could reclaim some of this money.

was the pregnancy planned surely you should of prepared financially for it??

Caroline73_2

Are you going to be able to pay your mortgage once you go back to work? Will you have childcare fees?

You've only had your mortgage for 18 months so saying you've always paid isnt an amazing track record. I think you need to start looking at alternatives to a payment holiday.

HappyMJ

As you have only owned the property for 18 months have little equity, a fixed interest rate and it is shared ownership it is highly unlikely you will get a payment holiday or even reduce to interest only. As the baby is a few months away you need to save every penny you can so that you can make the mortgage repayments.

RadoJo

They could argue that it's a little unfair of you to borrow money from them with an agreement to repay and then choose to reduce your income so that you are unable to meet your obligations. I would be surprised if they agree to a payment reduction on an 18 month old account anyway, but your Homebuy agreement weakens your position further. Are you actually relying on this payment holiday to be able to afford your mortgage - will you really not be able to afford to make repayments once you're on maternity leave?

pirate26

We will be able to afford our mortgage payments and childcare fees once I return to work; my question really was from the point of view of considering how long I can afford to have as maternity leave as I am the main earner, and obviously want to stay with our baby as long as possible.

Thanks for the replies; it helps to know what's realistic!

kingstreet

Payment holidays are designed to give those who make overpayments an opportunity to pay nothing for a while should they need to. Effectively, the payments they don't make during this period are covered by payments they've already made.

The holiday you are describing may be treated as mortgage arrears or (if you pay less) a payment arrangement, reducing your chances of a new mortgage in the immediate future.