Rent holiday whilst waiting for mortgage

NDTNewbie

Morning all, we have had our offer accepted on a property but due to C-19 they cannot complete a valuation. We have had to extend in our rented accommodation until this can go through, but I’m wondering if we took a payment holiday on the rent would it have a detrimental effect on our mortgage going through? I’ve been temporarily laid off for the foreseeable but once the lockdown is lifted I will be back to work. 

John_

You’ll be accruing a debt during the holiday, which may have an effect.

csgohan4

Have you told the mortgage lender, as being laid off even temporarily is a change in financial circumstances. I certainly wouldn't be committing to a large purchase if your job is not secure 

Caz3121

NDTNewbie said:

 if we took a payment holiday on the rent 

have you spoken to your landlord?
https://www.gov.uk/guidance/government-support-available-for-landlords-and-renters-reflecting-the-current-coronavirus-covid-19-outbreak
"Tenants are still liable for their rent and should pay this as usual. If they face financial hardship and struggle to pay this, support is available. In the first instance they should speak to their landlord if they think they will have difficulty meeting a rental payment, and in this unique context we would encourage tenants and landlords to work together to put in place a rent payment scheme"

NDTNewbie

@csgohan4
currently still getting paid by the company at 100% and will be working again once travel ban is lifted. 

Thrugelmir

What are you hoping to achieve by not paying your rent? Are you concerned about the longer term prospects for your employment. Any debt accrued by taking payment holidays is still going to have to be repaid. 

dimbo61

If you don't pay your rent then your landlord might get a CCJ against you for unpaid rent.
CCJ could mean No mortgage or car loan or credit card.
Your getting 100% pay and not traveling to work or going out, buying new clothes or meals out.

jackieblack

NDTNewbie said:

currently still getting paid by the company at 100%

So why do you need a rent holiday? 🤷🏻‍♀️

csgohan4

jackieblack said:

NDTNewbie said:

currently still getting paid by the company at 100%

So why do you need a rent holiday? 🤷🏻‍♀️

Entitled

[Deleted User]

As an Underwriter, my concern would be why you've taken a holiday if you're on 100% pay, but are telling us that your job is ok.

Are you taking the payment holiday because you're concerned the job may not be ok, and eventually, if this drags on, the 100% may drop to 80%?

If so, that's potentially a valid reason - but as others have said, the rent still needs to be paid. A future liability in mortgage applications is likely to have more impact than a slightly lower deposit (if you'd just paid the rent from salary/savings)

Although it's exceptional times and I'd hope Underwriters would look sympathetically on people with issues like that - it doesn't really show that you're willing to pay a mortgage in full for the next 20/30/40 years, if you've literally just taken a rent break but were on 100% pay. Some lenders may outright decline it - I know a couple are (or were a few weeks ago) declining people that took mortgage payment holidays.

If you can't complete your most important contracted payment now, what evidence is there that you will do so in 3/6/9 months?

I think it'll cause you more hassle that good. In any case - only take it if you genuinely need it! Your landlord is possibly struggling too. Also, if this goes on for longer than 3 months, there's no guarantee you're going to get another rent holiday - so you'd have used your 3 months when you don't really need it, then if your salary drops you genuinely need the holiday and can't have it!

MovingForwards

Can anyone link to evidence there's a "3 month rent payment holiday" as all I can see is the suggestion the tenant / LL speak with each other if there are financial difficulties and come to an agreement.

There's a halt on evictions at the moment.