Mortgage holiday?

benson2221

I recently switched jobs and now need to relocate closer to my new workplace. However, this means I'll have to bear the expenses of a new residence while still struggling to meet my mortgage payments. I'm wondering if there is a possibility of a lender granting a 3 to 6 month mortgage holiday to help me through this transition period. Alternatively, I'm open to exploring any other available options. I appreciate any assistance or suggestions you can provide. Thank you.

Caz3121

you can ask your lender however probably best to look at alternate options if possible as even an approved holiday will result in a negative impact on credit file (for 6 years) and additional costs (interest)

benson2221

Been seeing contradictory things with regards to it being on the credit report so thanks for clearing that up

FashionHeart

benson2221 said:

Been seeing contradictory things with regards to it being on the credit report so thanks for clearing that up

Also just to add that it will be even more expensive, as the mortgage account will end up being in arrears.

MWT

As many found out during Covid, a mortgage holiday does not mean that you stop paying for a few months then start paying the same amount again and continue as before.

When you restart the payments you have to deal with the arrears, one way or another...

FashionHeart

MWT said:

As many found out during Covid, a mortgage holiday does not mean that you stop paying for a few months then start paying the same amount again and continue as before.

When you restart the payments you have to deal with the arrears, one way or another...

Many people still don't realise the financial consequences when they hear about financial support being offered.

MWT

FashionHeart said:

MWT said:

As many found out during Covid, a mortgage holiday does not mean that you stop paying for a few months then start paying the same amount again and continue as before.

When you restart the payments you have to deal with the arrears, one way or another...

Many people still don't realise the financial consequences when they hear about financial support being offered.

Agreed, I really hope the planned 6 month Interest-only option does come with some serious questions and not just given on demand, because of the consequences for all but those in the special circumstances of guaranteed higher income or intention to end the mortgage within that period...

FashionHeart

MWT said:

FashionHeart said:

MWT said:

As many found out during Covid, a mortgage holiday does not mean that you stop paying for a few months then start paying the same amount again and continue as before.

When you restart the payments you have to deal with the arrears, one way or another...

Many people still don't realise the financial consequences when they hear about financial support being offered.

Agreed, I really hope the planned 6 month Interest-only option does come with some serious questions and not just given on demand, because of the consequences for all but those in the special circumstances of guaranteed higher income or intention to end the mortgage within that period...

Of course, it's attractive to those who are in financial difficulty, but again should be carefully considered and other financial options should be explored. 
The government should be really clear on the financial consequences, but they never do - they only mention the benefit of it.
But I don't see it that way - because as attractive as it may first sound, you'll still be paying more for what you already owe in the first place.
The majority of people have learned that during the payment holiday period during COVID.

simon_or

Taking a mortgage holiday will significantly mess up your credit history so only do it as a last resort. 

You could speak to your bank to see if they might give you the 6 month interest only option, perhaps that could give you some temporary relief. As per what I can see, that won't have the adverse impact that a mortgage holiday would.

MWT

simon_or said:

You could speak to your bank to see if they might give you the 6 month interest only option, perhaps that could give you some temporary relief. As per what I can see, that won't have the adverse impact that a mortgage holiday would.

If you are on a repayment mortgage and you take 6 months on interest only that leaves the unpaid capital component to be dealt with at the end of the interest only option...

So that means either a lump sum payment to get back to where you should be at that point, or an increased monthly payment, when 6 months earlier the borrower couldn't handle the payment at the level it was at originally...

This is why extending the term is a better option for most, if it is possible. Exceptions would be those who are selling during that 6 months, or otherwise ending the mortgage, or those who are expecting an improvement in their income within that period...

ACG

What will happen to the property? 
If it is empty - do you have the correct insurance? 
If it is to be let out, you need permission from your lender and also the correct insurance. 

The only people who can answer your question is your lender. It varies to an extent from lender to lender and your circumstances.