Mortgage Holiday to pay credit card, yes or no?

[Deleted User]

Well this is what I was thinking;

I have the credit card debt that is in my signature, however I want to clear it asap, work on my credit raiting so that I can buy a house in full and start a fresh.

So I read the rules about mortgage holidays, so you end up paying more and you can only have 1 x 6 moth break in the term of the mortgage. I hope to take another mortgage as soon as I can obtain one and move home.

So what should I do? This is not my strong point, hence why I am here :-/

bottleofred

Hi assj,

It's entirely up to you what you do, although if you take the mortgage holiday and settle the credit card, is it going to save you money in interest repayments? Also consider if it affects any future mortgage applications. As you are the one who is going to be making the repayments etc, only you can decide. However, if it saves you money and has no adverse effect on future applications for credit and particularly mortgages, then I'd seriously consider it.

Good luck whatever you decide

Red

Happytogetdebtfree

How much is your mortgage a month? I don't know what a payment holiday would mean in terms of paying more but hopefully others will be along soon to help

[Deleted User]

Well im a shared owner and need to get out of the shared ownership trap, our rent increases every year and it's now costing more for the rent than a full rental property would be.

Okay so I would have 180.00 extra a month to throw at the credit cards, the credit card apr is 29.9% on the one card.

I don't know if the holiday impacts on future applications, I thought it was an agreed part of the mortgage offer? Anyone?

Thanks both I was thinking nodbody would reply for a minute...

rising_from_the_ashes

I thought about taking a mortgage holiday last year - to try to build up some emergency funds.

I was allowed 1 months' break for every 9 months I'd had the mortgage so could've had 5 months payment free (which would've built up a nice emergency buffer) - "allegedly" without any implications although obviously the term would've been increased to cover the breaks.

However, as I was thinking of applying for a new mortgage, I was advised not to take the break as it can reflect badly on your credit report..... no idea if this is the case or not as I decided not to take the break just in case.

It may be worth checking with your mortgage company if they put any info re the break on your credit file (ie does it show as a late/missed payment etc)

[Deleted User]

Oh right, well I have looked at my report and I did notice the options for payment holiday markers, not that I have any yet, so does anyone else know if this impacts future applications?

[Deleted User]

You were correct it does impact future applications, so thats a no for for me now! Oh well was worth the thoughts.

Thanks All