Coronavirus Mortgage Payment Holiday: Common Q’s & A’s

by | Mar 23, 2020 | Mortgages, News

With the Covid-19 epidemic causing a global health and financial crisis, mortgage lenders are offering a coronavirus mortgage payment holiday.  

Here are some common questions we’ve been asked…

What is a mortgage payment holiday?

A payment holiday allows you to stop paying your mortgage for the agreed period of time and won’t have any negative impact on your credit rating (speak to your lender for details).


Can I apply for a mortgage payment holiday? Yes, if:

– Your ability to pay has been affected by Coronavirus

– You’re up-to-date with all your monthly mortgage payments

– You have consent from everyone on the mortgage

Under normal circumstances, lenders would assess your financial situation and ask you to provide information so that they can consider the options that are most suitable. However, these are exceptional circumstance so generally it is their current situation that will be discussed re COVID-19.

Lenders will require you to call them to discuss your situation.  This measure covers buy-to-let and residential mortgages.

If you are already in arrears, you may not be eligible for a payment holiday, but there are other ways that lenders can support you during this time –  so you should still get in touch or speak to your broker.

Generally, lenders are seeking to ascertain are you sick with COVID-19 and now on SSP or have reduced hours working or lost their job, etc.  If that is the case then a repayment holiday might apply. 

What if I need a longer holiday after 3 months?

You might not have to make repayments immediately, and if you have lost your job, etc, additional help can be provided so try not to worry.

Some lenders will require you to call in but some will allow customers to apply online. Check your lender’s website first and speak to your broker.


How will this impact my credit score?

Where a payment holiday has been agreed in advance, this won’t lead to any arrears being reported to the credit reference agencies so this will not impact your credit score.

However, if you haven’t come to an agreement with the lender and you miss a payment, this would be reported to the credit reference agencies in line with the normal process.


What happens to the payments and how will that impact my mortgage going forward?

A mortgage payment holiday only means a break of up to 3 months from your mortgage payments, and you will need to make up these payments through the term of your mortgage.

Ramsay & White is a specialist mortgage brokerage serving the specific finance needs of property investors across the UK.

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