Payment Holiday FAQs
Yes, in line with UK Finance guidance we’ll continue to offer payment holidays of up to three months if you’re unable to make mortgage payments during these unprecedented times. All payment holidays must end by 31 July 2021.
No, you can request a payment holiday of up to 6 months in total, but we can only agree a payment holiday of up to 3 months at a time. We may be able to renew your payment holiday after the first 3 months, as long as this doesn’t take you over the 6 month limit.
If a payment holiday is agreed, the Credit Reference Agency will be notified you have an arrangement in force. The mortgage won’t be classed as in arrears as this has been agreed between you and us. We’ll ensure that if you take a payment holiday it won’t negatively impact your credit score. If you experience any issues around this please get in touch so we can help.
At the end of the payment holiday the amount deferred can be repaid either:
• By making a single payment for the full amount
• By making an arrangement to repay the deferred amount over an agreed period of time, in addition to resuming normal monthly repayments
• By recalculating the monthly mortgage payments at the end of the payment holiday which means payments may increase.
It’s important to remember that even though you may miss payments due to the payment holiday, by recalculating the monthly payments the amount owed will go up. That’s because we’ll still add interest to the mortgage while you take a break.
If you’ve been affected by Covid–19 you’ll automatically be eligible for a payment holiday. You’ll need to be up to date with your mortgage payments and have consent from everyone on the mortgage. If you aren’t up to date on your mortgage payments, please contact us to discuss your options.
If you’re newly affected by Covid-19, and you want to benefit from the full 6 months available, you should apply plenty of time before your February 2021 payment is due. Your payment holiday will then run from February to April at which point you can contact us to ask for a further three months, taking you up to July.
- If you’ve already taken payment holidays of less than 6 months, you have until 31 March 2021 to apply for another payment holiday.
After 31 March 2021, you can extend an existing payment holiday up until 31 July 2021, as long as:
- It doesn’t go over the 6-month payment holiday limit
- There aren’t any breaks in the support
You won’t be eligible to apply if you’ve already had payment holidays of 6 months in total. Instead, you can ask us for tailored support.
It’s important to remember a payment holiday is a temporary break from your mortgage payments to help if you’ve been affected by Covid-19. There are a few things to consider before applying for a mortgage payment holiday, to make sure it’s right for you:
- When the payments start again, they’ll be recalculated, and you may see an increase in the monthly payments
- The total amount of interest you pay over the term of your mortgage will increase.
Anyone concerned about the impact Covid-19 will have on their income should contact us as soon as possible. We’ll make every effort to support people already in financial difficulty and will make this process as simple as possible.
We hope this answers any questions or concerns you may have, if you have any questions please get in touch with your financial adviser who can contact us on your behalf, or call us directly.