Mortgage holiday implications

[Aniseedball76]

Considering a short mortgage holiday during upcoming mat leave. It would really help as I'm the sole earner (DH is part time SAHM/part time writer) and have just spent a load of our emergency funds on house repairs that couldn't wait (terrible timing). We are due to remortgage in 2027.

I don't think the increase in payments post holiday would be a problem. More concerned about difficulties remortgaging in the future. Any insights?

Either take a very small period of mat leave or tell DH to get a job. They should be your choices before you look at mortgage holidays

As well as the cost of extra interest, you'd need to see if it was going to be marked as an 'arrangement to pay' on your credit file, because if this is the case, it really should be avoided unless the absolute last resort as it could damage your credit file for 6 years.

If you're at home, your DH could get some temporary work for at least a few hours a week to hopefully avoid having to take a mortgage holiday.

You’ll know best with your lender but I’ve found very few still allow holiday breaks.

you need to explore all options before taking a mortgage holiday, it should be last resort as it will go in your credit report, especially if you’re remortgaging in 2027. If your DH is a SAHP then you cake take a short mat leave, or your DH gets a job and you be the SAHM whilst on maternity leave.

Are you sure you'll be able to get a mortgage holiday? I asked my mortgage provider when I was having breast cancer treatment and would be on half pay for a few months. They said "no-one does those now"

Hi OP,
The 2024 mortgage charters gives the option of going interest only for 6 months without affecting your credit (you obviously have to agree this with your lender not just do it).

The charter also says that people should be able to choose a new deal with their lender (edit to say at the end of the offer term of their existing mortgage) without further affordability checks - as long as their payments are up to date.

Not all lenders are signed up to this I don't think but the major lenders should be.

https://www.gov.uk/government/publications/mortgage-charter/mortgage-charter

We did this during my last mat leave. We opted to pay interest only for six months which meant it didn't affect our credit under the new mortgage charter scheme. Obviously the total cost of borrowing is higher over the term of the mortgage but we felt it was worth it to take the financial pressure off now, especially given that we'll probably move or remortgage at some point.

We did it 8 years ago with our old provider when I was on SMP only, 2 month mortgage holiday and didn't affect anything at all, however - the new provider don't offer then so you'd need to check that!

Best thing you can do (if affordable) when you get on your feet is make a small overpayment each month. I used to do this. I wanted to take 4 months off work and have a mortgage holiday and they said I could have 3 years if I wanted. Just had 4 months and shortened mortgage term in the end.

We did a 2 month mortgage holiday with TSB last year. It hasn't affected our credit ratings at all.