Mortgage Payment Holiday as Debt Solution - Good Idea???

cherylwales

Could somebody give me advice on the following idea please?:

We have the opportunity to take payment holidays from our Nationwide mortgage. We owe around £3,500 on credit cards and other debts. Our mortgage payments are £760 per month. If we took a payment holiday for 3 or 4 months we could clear our debts with the money usually paid on the mortgage. Interest would still accrue on the mortgage for this period, but I reckon this wont compare to the amount of interest we are paying on the various credit cards (or indeed to the amount we have already paid on them in charges and interest) if we pay them off longterm with the small amounts we can afford otherwise. Is this a good idea or am I missing something?

Thanks for any help
(Sorry if this has already been discussed - I am new to the site and have searched but cannot find anything to help)

talc

Hi
Will Nationwide ask the reason for the payment holidays. If they do will they let you effectively transfer the £3500 onto your mortgage.
The reason I am iffy about this is that I have the same opportunity to have a payment holiday with our Halifax mortgage. After seeking advice on the DFW board, I may ask the Halifax to pay interest-only on our mortgage for a while, and pay the capital of our credit card bills.
Hope this helps in any way - as I am toing and froing with different ideas to attack my credit card debts, currently £47K:mad: .

kingkano

Depends what you mean 'long term with small amounts'? Dont forget the 3500 is probably mostly interest. But also there will be interest ON THE INTEREST, for the rest of your mortgage period (25yrs if thats what you have left on your mortgage). So while its a lower rate it might be a very much longer term than if you cleared the cards by paying what you can as you can.

There is another thing to consider. If you clear the 3500 off by taking a payment holiday, will you still have the conviction to change your spending habits, so you don't end up with another few thousand on credit cards next year?? This is as important a decision as the payment holiday itself....

cherylwales

Thanks Talc and Kingkano for you advice. We are normally quite good with money, but things seemed to get out of hand last year with our central heating needing to be replaced and various one off things that had to be paid for which resulted in the credit cards being used. We've never owed this much money before and so am finding the thought of the debt very stressful. I think you are probably right though in that such a quick fix solution might not be the right way to go and in the long term, we may be better off just trying to pay off the credit cards as and when we can. Thanks again for your advice.
Cheryl

UK007BullDog

Try to swap the CC's for low cost cards or 0% cards.

gsnow1970

I tried to get a holiday from my Nationwide Mortgage but its not as easy as you think. They only accept a few reasons for doing it and usually you have to prove the reason. In my case me and my girlfriend were having our first baby and thought a mortgage break 3 or 4 months would give us a nice cushion. However even though my girlfriend has her own house and has nothing to do with my mortgage whatsoever, nationwide said I had to PROVE she was pregnant with an MATB1 form!! I thought this degrading and asked Nationwide to do as they are "contracted" to do by their advertising of the mortgage but they point blank refused and closed the offer to me.
So its a nice idea but try executing it!!!

Thrugelmir

gsnow1970 wrote: »

I tried to get a holiday from my Nationwide Mortgage but its not as easy as you think. They only accept a few reasons for doing it and usually you have to prove the reason. In my case me and my girlfriend were having our first baby and thought a mortgage break 3 or 4 months would give us a nice cushion. However even though my girlfriend has her own house and has nothing to do with my mortgage whatsoever, nationwide said I had to PROVE she was pregnant with an MATB1 form!! I thought this degrading and asked Nationwide to do as they are "contracted" to do by their advertising of the mortgage but they point blank refused and closed the offer to me.
So its a nice idea but try executing it!!!

Why drag up a thread from 2008? Better to post your own.