Reducing mortgage payments whilst on maternity

corkgirl

Hi,
I hope someone can offer some advice on any similar situations.
In June I will be taking maternity leave for 6 months, and will only receive statutory payments. This will be a massive drop for hubbie & I since I earn about double his salary.
I want to plan in advance for this in terms of coming to some agreement with A&L to reduce our payments for 6 months. Whilst we have saved we don't have enough to cover 6 months mortgage payments. We also don't have any overpayments made, as it was a restrictive mortgage, so all spare money went into savings, home improvements etc.
But they are saying that they can't give me any suggestions now, and I would just have to phone back in July. I'm reluctant to re-mortgage since we are on a really good interest rate, and would need ~6 months payments before we could go flexible etc. We've also had our current mortgage for 6 years, never any issues, defaulting etc.
But I'm trying to be pro-active & financially responsible and don't really want the worry about how we will cope hanging over me.
Any suggestions/advice?
Thanks.

opinions4u

I'm trying to be pro-active & financially responsible

In June I will be taking maternity leave for 6 months

Whilst we have saved we don't have enough to cover 6 months mortgage payments

A mortgage lender is not required to reduce payments because you have a baby on the way.

As a priority payment, they could and should reasonably expect you to cut back in other areas before asking for help. What unsecured credit do you have? These payments should be missed before underpaying a mortgage.

Unless the lender has a mortgage payment holiday facility that you could use, any help they do offer you is going to negatively impact your credit file.

The position you find yourself in could damage you credit file until 2019.

I would suggest that you redouble the savings effort and cut back on other things big time.

Perhaps complete a statement of affairs (SOA) at www.makesenseofcards.co.uk will help you identify ways of cutting back. Mobile phone contacts, TV, entertainment are a good starting point.

crombie2012

Hi corkgirl,

I work for a mortgage collections dept & we specialise in helping borrowers such as yourself who are going to be on a reduced income, whether that be through choice (babies) or not (unemployment).

Opinions4u is right in the sense that the mrtg company are not obligated to reduce ur payments because you will be on maternity leave but for a decent level of customer service, they should aim to help you and if poss, stop you falling into arrears.

Your best option is to request to go onto a temporary interest only basis for the time that you are on maternity leave to lower your payments, which also stops arrears mounting up. The only downside is that you wont be paying any capital during this time so your mrtg balance wont go down BUT when you convert back to Repayment, the mrtg term will remain the same & they will just calculate the balance of the mortgage over these remaining years, which can increase your monthly payment a bit (it shouldnt be much as its only 6 months on i/o)

You will, however, have to show your mortgage company that you are making cutbacks to unnecessary cutbacks before they will even review it, let alone agree to it. Be proactive & reduce your payments to TV/internet packages, mobile phone, clothes shopping or other luxuries, unsecured debt which is credit cards, personal loans, finance agreements, catalogues, store cards (these can be reduced down to as little as £1pm whilst you are trying to maintain your priority payments, which is your mortgage, any SECURED loans & your council tax).

The conversion from REP to I/O can take about 6 weeks to do from when u first enquire about it to when it is actually converted, so if the above is relevant to you, I would get on to your mrtg co as soon as poss!

crombie2012

*unnecessary EXPENDITURE, not unnecessary cutbacks. My mistake!