Mortgage payment holidays

As we approach the end of June, many mortgage customers will be receiving letters informing them their 3 month mortgage holiday is coming to an end. Many of you will be considering if taking a further 3 month break is the right thing to do. We have received lots of questions recently around this subject and they have been difficult to answer.

Our clients look to us to guide them when making decisions. The problem is we need the information from lenders before being able to offer the right advice. Despite the Government announcing an extension to the scheme last month, lenders still do have the right to factor your need for these holidays into their underwriting criteria. We have already seen buy to let lenders frown upon applications where it was clear the client didn’t need the support but took advantage of the opportunity.

So I would like to give a word of warning (read as Nanny McPhee, sort of) if you need it, take it, as it won’t be available forever. If you don’t need it, don’t take it, as you may be damaging your ability to borrow in the future.

The essential part is – if you need it, take it. Despite the fact lenders may ask more questions about your payment holidays in the future, if you need to take a holiday it is likely you would be able to prove that it was essential so don’t be put off.