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Advice on payment difficulties
Here's what you need to be aware of if you're currently taking a mortgage payment deferral or intend to apply for one
The payment deferral scheme was introduced to provide short-term financial help until Government support became available. If you don’t make any payments during the payment deferral, we will continue to charge interest on your mortgage.
If you are currently taking a payment deferral or intend to apply for one, your three options at the end of the payment deferral period are:
1. Spread the cost of your deferred mortgage payments over the rest of your mortgage term
2. Arrange to pay the cost of your deferred payments in a lump sum
3. For those with a capital repayment mortgage, extend your mortgage term for the length of time that you took a payment deferral
In considering your options please remember that where appropriate your mortgage allows you to make additional payments each year (sometime called overpayments, or capital reductions), with no early repayment charge on payments of up to 10% of the balance. Making additional payments as and when you can afford to do so will help reduce your mortgage balance faster than would otherwise be the case and will reduce the interest that you pay. If you are not in a position now to pay the full amount missed during your payment deferral, making additional payments in future could help you get your mortgage back on track. Your mortgage offer (or more recent product switch offer) contains more details.
Will any of these repayment options affect my credit history?
The options above will not be recorded in your credit history and will not affect your credit score. However any support provided after that period may affect your future credit score. if you apply for credit or a mortgage elsewhere there are other ways lenders can tell whether you have taken a mortgage payment holiday, which could impact future lending decisions. Lenders may take into account other information when making lending decisions, including information provided by you or bank account information, for example.
Concerned about your finances?
We understand that coronavirus has had widespread effects beyond your ability to pay your mortgage. There are organisations out there to provide you with help if you need it. Those organisations are listed at the bottom of this page.
It’s in your interests to start making your mortgage payments if you can afford it.
However, if you are still suffering from financial hardship as a result of coronavirus and none of the above options are right for your circumstances, please call us so we can try and find a solution for you. This may include a further payment deferral or partial payment deferral, rearrangement of a repayment mortgage to Interest-Only (or part repayment, part Interest-Only), term extension or a combination of these.Ask us to call back Email us
Further support and advice
For more information on financial support available, you might find these websites useful:
- General government guidance and support
- The Money and Pensions Service have launched a new online tool to help those affected by Covid-19 navigate their finances:
- If you're struggling to pay your bills, Citizen’s Advice offers some useful information
- You may be entitled to benefits, find out more with Citizen's Advice
- The Money Advice Service can offer support with managing your money, including steps you can take to prepare for if your circumstances might change
- For most people, it's a good idea to pay essential costs and priority debts before spending money on other things or non-priority debts. The Money Advice Service has a budget planner to help you work out essential costs and it has also produced a guide to help you prioritise your debts.
- The Financial Conduct Authority has produced a guide to managing financial difficulties during coronavirus
- Other places where you might find useful information at this time include Which? and Money Saving Expert
- Money and Mental Health - Practical Financial Skills to Manage Money offers practical information and useful tips on budgeting and dealing with debt
- If you are feeling stressed or worried and need help with your mental health, The Money and Mental Health Institute can direct you to help.
Do you need our help?
If you have any questions about your mortgage payment deferral please contact our friendly Mortgage Service Team.
Further support and advice for landlords
Helpful information and support when engaging with tenants during this difficult time.