How can I get a mortgage repayment holiday?

A reader from Watford is taking time off from work, so wants to know how easy it is to get a mortgage payment holiday.

Tony Davis, myfinances.co.uk mortgage expert from Mortgage Meadow, takes her through the problem.

Mrs Locke asks

I need some advice as I currently have a mortgage with the RBS and we are having a very quiet couple of months at my workplace.

I am a part-time worker and am having to take two months unpaid leave as there is no work. My concern is how I will be able to make my mortgage repayments for two months as I will have no money coming in.

I have always paid my mortgage and on time. What would you recommend I do? Do you think my mortgage lender would give me a payment break?

Please advice me which would be the best way round this problem as it is only a temporary measure.

I look forward to your reply.

Tony replies

You must speak with your lender. Mortgage companies are obliged to treat situations of financial difficulty positively, however, for them to assist you need to talk with them.

All lenders must act responsibly and they will need to see that this is a short-term issue and moreover how you plan to repay the few months you wish to miss now.

They will probably want to see a budget planner to make sure that you do not have other options open to you before taking a payment holiday un-necessarily.

There could be other solutions such as, depending on your type of mortgage account, you might be entitled to take a payment holiday as part of the terms of your loan agreement, or, if you are on a capital and interest mortgage the lender may consider converting it to interest only for a few months, keeping your payments to a minimum but preventing you from falling behind on your payments.

Even if the lender does agree for you to take a payment holiday, remember that the missed payments will be recorded on your credit file and this could well affect your credit rating in the future.


If you have a question for Tony, go to the myfinances.co.uk Ask the Mortgage Expert section.

Or for more information or mortgage advice go to Mortgage Meadow.

Mortgage Meadow is an independent mortgage broker and is authorised and regulated by the Financial Services Authority.