Mortgage payment holiday

[abracadabra]

We are feeling the pinch now I'm getting towards the end of additional maternity leave, and wondering about trying to get a 2-3 mth mortgage payment holiday - just wondered if anyone has done this and whether there are any pitfalls/issues to be aware of (I'm financially illiterate by the way). Or would it be better to dip in to our (fairly miniscule)savings?

I don't want to scare you but we took a payment holiday when dh was made redundant. We sold the property as we were relocating after the redundancy but last year we tried buying a house again and we found that the new mortgage company classed the payment holiday as arrears

We've done it abra, in exactly the same situation as you ie at the end of my first maternity leave. Am sure that financially there are some pitfalls but it just seemed the easiest way for us! With our new mortgage however, you have to have "extras" in your fund through over paying before you can have a break - didn't realise that until we tried to have a break on my second maternity leave!!

We did it too. We had the option to either pay the interest over the 12 months or pay nothing. Had we paid the interest which was roughly half of what we normally paid we would not have increased our payments when our holiday finished nor would they have added any extra years so a win win.

We opted for the pay nohting holiday and our monthly payments went up after the holiday but all in all it was a sensible thing to do.

I am a bit concerned about some companies seeing it as arrears.

I am with the NAtionwide and I don't think all lenders have such good holiday terms.

You nead to speak with your lender as they all vary. Sometimes they ask that you have overpaid on the mortgage, but like I said best to give them a call. If you are on repayment you could switch to interest only and tread water for a while.

With our mortgage company a payment holiday is just paying the interest, but our mortgage is like a huge overdraft secured against the value of our house. We can increase our overdraft value as well (as long as it is not too close to the house valuation). DH resigned from his job last year and his salary stopped recently so the flexibility of this type of mortgage has really worked for us, esp as we have quite a lot of equity. It's kind of annoying to be dipping into our equity but better that than not having any assets.