Mortgage payment holiday extensions

Homeowners struggling to pay their mortgage due to coronavirus are now able to extend their mortgage payment holidays for three more months, in new measures which came in to force from Thursday 4 June.

The application period for an initial mortgage holiday has been extended until 31 October 2020, allowing anyone who is starting to experience financial difficulty over the coming months to ask for help.

If your mortgage payment holiday is due to end, you can now extend it by three months

These updated measures mean you can ask for a further three months help if you are going to still struggle to pay your mortgage as a result of coronavirus.

It is important that you seek advice before extending your mortgage payment holiday. A Linear adviser will talk through the possible risks and longer-term financial implications you may incur should you apply for a mortgage holiday extension past three months.

If you can make your full payments, you should do so

At the end of your initial three-month mortgage holiday, your lender should be in touch to find out if you are able to start paying again. Your lender will also set out and agree a plan with you to make up the missed payments.

This may include spreading the cost of payments over the remaining mortgage term or extending your mortgage term. Your mortgage adviser will be able to talk through what this means for you monthly payments and how it will affect you.

Will a mortgage payment holiday affect my credit rating?

Payment holidays will not be marked as missed payments on your credit score, however it can impact future credit applications. You should think really carefully about the risks of taking or extending a mortgage holiday.

Are all lenders doing the same thing?

No. The standards set by the Financial Conduct Authority are the basic rules and do not stop lenders from going above and beyond – for example, offering reduced interest.

You must speak to your mortgage adviser before you take any action or decision on your mortgage payment holiday. It is important to understand all the risks and benefits specific to your own individual circumstances.

Your property may be repossessed if you do not keep up payments on your mortgage. 

There will be a fee for mortgage advice from Linear Financial Solutions. The precise amount will depend on your circumstances but may range from £399 to £599.

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We have local mortgage advisors across the UK. It is always best to speak to a mortgage advisor who can help you find the best deals for your circumstances.

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