How has COVID-19 affected my mortgage? Your top 5 questions answered
PUBLISHED: 14:10 12 May 2020 | UPDATED: 14:10 12 May 2020
James Rice from The Mortgage Centres answers your top 5 questions about your mortgage during coronavirus, explains what help is available and why you shouldn’t be concerned.
Q: What help is available for homeowners that are struggling during COVID-19?
As one of your most expensive monthly out-goings, you may have found it a struggle to keep up with your mortgage payments.
If you’re on furlough or are working less because of the pandemic, there is support available. You can apply for a mortgage holiday to take a temporary break from your mortgage payments.
Our website has been updated to include the application process with a range of mortgage providers for payment holidays.
Q: What is a mortgage payment holiday?
It allows you to stop or reduce your monthly mortgage payments for up to three months. It may not be suitable for everyone but could offer some vital assistance if you need it.
When your payment holiday has ended, you will see an increase in the mortgage repayments. This is because these payments are added to your outstanding mortgage balance.
Check with your mortgage provider that a payment holiday won’t harm your credit rating. Most providers have confirmed that it won’t affect your credit score although some may register it as mortgage arrears.
For these reasons, it’s important you only take a payment holiday if you absolutely need it.
Q: Will the pandemic affect my residential mortgage application?
If coronavirus has affected your income, either temporarily or permanently, this could have an impact on your mortgage application.
Each mortgage provider will have different policies on this. For this reason, it’s important you speak to your mortgage broker first.
You can also call a member of our team to discuss your mortgage application and we’ll run through your options with you on the phone. Our initial advice is free.
Q: How can I apply for a mortgage during lockdown?
Currently, surveyors can’t carry out physical valuations of properties due to social distancing measures. Where possible, lenders are looking at ways to produce valuations remotely. This does, however, limit the number of mortgage products available.
For now, if you have less than a 15pc deposit or less than 15pc equity in your property, you may not have the same choices as you did before.
Mortgage providers are constantly reviewing this and finding ways for customers to buy their dream homes or secure a competitive interest rate on their current mortgage.
Q: Can you help me with my buy-to-let mortgage?
Mortgage holidays are also available for buy-to-let mortgages that landlords can take advantage of if they want to.
It may be helpful for those that currently have tenants who are also struggling to keep up with rent payments in the pandemic. It will give you some flexibility with your mortgage and allow you to help your tenants if they need it.
For anyone living in rented accommodation whose income has been adversely affected by COVID-19, I’d recommend speaking to your landlord as early as possible to see if there’s a way you can work through it together.
If you’re a landlord in need of some advice about your buy-to-let mortgage or want to know how you can apply for a mortgage payment holiday, give us a call or visit the COVID-19 update page on our website.
Q: How can I get in touch?
If you’re looking for a new mortgage or have questions about your current one during COVID-19, it’s worth seeking impartial expert advice.
We speak to hundreds of people every month about their mortgage, helping them find solutions that are right for them.
We’re able to continue to provide our services remotely and can speak with you over video and phone calls or over email.
Visit themortgagecentres.co.uk/branches to find your local advisor.
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