Coronavirus – Mortgage information
Mortgage payment holidays and furloughed income policy
Understanding mortgage payment holidays (also known as payment deferrals)
You may be eligible to apply for a payment holiday if you have been directly or indirectly impacted by Covid-19
Payment holidays can be taken for up to 3 months at a time, cannot be longer than a total of six months, and must have been applied for by 31st March 2021 and has finished by 31st July 2021.
After 31 March 2021, you can extend an existing payment holiday until the 31 July 2021 as long as your request does not go over the six month limit and there are no breaks in the payment holiday
How to Apply
If you haven’t already taken a mortgage payment holiday, think you would be eligible and would like to apply for a payment holiday, complete the form below or call us.
If your account is in arrears, you may be eligible but we'll need to talk to you to assess this.
You have already had a mortgage payment holiday (deferral)
If you have already had a mortgage payment holiday and want to apply for a another, you will have to wait until you have come to the end of your existing payment holiday and have received a letter from us outlining the impact it has had on your mortgage.
Once you’ve received your letter you can apply for a further payment holiday by completing the form below or by calling us.
If you can afford to re-start your mortgage payments it’s in your best interests to do so.
You have already had a total of six months of mortgage payment holidays (deferral)
If you’ve already taken a total of six months payment holidays, please do not fill in the form for another as it will automatically be declined.
If you’re still worried about meeting your future mortgage payments please call us on the number below as soon as possible, to talk through your options.
You can talk to us
If you’re worried about meeting your long term financial needs then a payment holiday (deferral) may not be the best option for you. This is because during the payment holiday period interest will continue to be charged and your mortgage balance will increase. If you’re already in arrears or facing long term difficulty it’s really important you talk to us before applying for a payment holiday.
If you think you would be eligible and would like to apply for a payment holiday (deferral), complete the:Mortgage payment holiday (deferral) request form
We aim to respond to your request within 7 working days but please bear with us as we are experiencing high volumes.
0800 138 2402*
9am - 5pm Mon-Fri 9am - 1pm Sat
Although we try to help as many customers as possible, there will be some cases where a payment holiday (deferral) may not be available to you.
To help us process your request, we may need to call you to talk about your finances to help us understand your current financial situation. This will include discussing details of any regular source of income and any regular expenses.
You can also cancel an existing payment holiday at any time by calling us. Cancelling your payment holiday early would have a positive impact on your future monthly mortgage payments.
Mortgage payment holiday (deferral) FAQs
Before you request a mortgage payment holidays
Before you apply for a mortgage payment holiday, whether it’s a further payment holiday or for the first time or it’s the first time it’s really important you understand the impact of a payment holiday on your future payments and what it will mean for your mortgage.
Call us and we can provide you with an estimated illustration.
0800 138 2402*
9am - 5pm Mon-Fri 9am - 1pm Sat
Or you can use the calculator within the online mortgage payment request form. Please remember the figures we show you are based on some assumptions, such as you having only one interest rate on your mortgage. If your mortgage has multiple parts, the calculator will assume all the parts have the same interest rate and term as well as repayment type. You can check your interest rate and remaining time to pay (term) on your latest mortgage statement or checking your mortgage account online. When you make your calculation, make sure you use:
- The highest interest rate you’re paying
- The shortest term you have left
- Tick the repayment type with the highest balance (if part Interest Only and part Repayment)
Please be aware that this illustration does not include any mortgage payment protection insurance premiums collected with your mortgage payment. If you would like us to help you with the illustration, call us on
0800 138 2402*
9am - 5pm Mon-Fri 9am - 1pm SatThe figure the calculator will give you is based on the accuracy of the information you provide.
Examples of mortgage repayments after taking a mortgage payment holiday (deferral):Outstanding mortgage amount: £50,000
Outstanding mortgage amount: £115,000
Outstanding mortgage amount: £150,000
You don’t need to provide any documentation; you will just need to self-certify that your income has been either directly or indirectly impacted by Covid-19.
The unpaid interest from your payment holiday will still be recovered later, but individual credit ratings will not be affected. However, it’s important to know that credit files aren’t the only source of information which lenders can use to assess creditworthiness.
If your mortgage is a buy to let and we agree a payment holiday with you because your tenant is unable to pay the rent then the benefit of the payment holiday should be passed onto the tenant.
If any of your mortgage account is interest only repayment, you need to be aware that these balances will increase to cover the amount of accrued interest that has been added due to the missed payments.
For the interest only elements of your mortgage the recalculated monthly payments will continue to only pay off the interest and will not reduce your increased outstanding balance. It is important, therefore, to check regularly that your savings plan and other investment plans that you may have in place is on track to repay your mortgage at the end of its term.
FAQs for ongoing mortgage payment holidays
If you have taken a mortgage payment holiday, we will send you a letter in the post which will describe all the options available to you.
We will send your letter a month before your payment holiday is due to end, but allowing for any postal delays, we would expect the letter to arrive 15 days before your next payment is due.
To make sure our contact centre colleagues can speak to those who need our help the most, please don’t phone us unless you have not received a letter and your payment holiday is due to end within the next two weeks.
The letter will confirm:
- Your mortgage payment holiday end date
- Your new monthly payment and how it has been calculated
- Your expected mortgage balance at the end of the payment holiday
It will outline what next steps you can take, including what to do if your employment status has changed if you think you might have difficulty making your next payment. It will also tell you what you can do if you feel a payment holiday wasn’t the best option for you and you would like to pay back the missed payments by a different means.
It’s in your best interests to start making mortgage payments again, as soon as you can afford to.
We’ve also listed all the phone numbers you’ll need to make sure you speak to the right person.
You will still owe the money where a payment holiday was been granted and interest will still accrue, so if you are able to make part of your normal mortgage payment to reduce the money you owe or your interest charges then you should consider doing so.
At the end of the payment holiday we will recalculate your monthly payment based on your outstanding mortgage balance and remaining term. It is very likely your payments will increase, particularly if you have a shorter term left on your mortgage.
Product transfers while on mortgage payment holiday (deferral)
Yes, providing your account wasn’t in arrears prior to the holiday and you meet our usual criteria, we can arrange a product transfer for you.
No, providing your account wasn’t in arrears before the holiday and isn’t in arrears after the holiday and you meet our usual product transfer criteria, you’ll be able to go ahead with the transfer.
We’re currently working on this. In the meantime please use this online form to submit a request.
Update to our lending policies
Currently, we don’t accept furlough income for mortgage applications.
Furloughed applicants must be back at work on their full salary before we can consider their income for a mortgage application.
For joint mortgage applications, where one applicant is on Furlough we will assess the affordability of the mortgage using only the salary of the applicant who is not on Furlough.
Maximum loan to value changes
We can now offer mortgages on the following:
- If you’re purchasing a new property the maximum loan-to-value (LTV) is 90%
- If you’re re-mortgaging your property the maximum LTV is 90% LTV or less
- New Build purchases up to a maximum of 85% LTV