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Santander Mortgage holiday - adding interest

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  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic

    And they will make money from the situation, because they have lent money / offered more flexible terms, which they will charge additional interest on. All seems like a great deal for the lenders
    If there were no mortgage lenders in business you wouldn't be able to borrow to buy a house. If your employer doesn't make a profit then your salary wouldn't be paid and your job would go. That's the nature of the world we inhabit. 
  • amnblog
    amnblog Posts: 12,728 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
     In essence they're not offering to anything more than lend more money with interest, which is what they do as a bank anyway (to make money)‘
    You’ve got it.
    They are rolling up the interest on two months and deferring the capital repayment for 236 months.
    If, at a later date you can overpay by two months your costs are back to square one.
    Alternatives are:
    Pay monthly as usual at no extra cost
    Don't pay for a month or two and see your credit file dented

    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • headoutthesand
    headoutthesand Posts: 1,041 Forumite
    500 Posts
    Can I just ask, as I have obviously misunderstood the explanation on their website, it’s only the interest that’s spread over the remaining term and the ‘holiday term’ added on to the end? 
    I had read it that the payments would be spread over the remainder of your current deal and so left it at that. My deal is up in February 2021 so I was afraid to ask as I wouldn’t be able to afford the repayments if that was the case. 
    Official DFW nerd no 551 - proud to be dealing with my debts
    Debts as of March 2014
    Nationwide - £5745, Overdraft - £350,
    Debts as of January 2015
    Nationwide - £4997, Overdraft - £0:j
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