Are Mortgage Payment Holidays Really “Risk Free”?

Wednesday, July 22nd, 2020

The mortgage market is about to enter a new phase following the end of the many mortgage payment holidays that were taken out by the millions of people who found themselves seriously impacted by COVID-19 during these difficult and unprecedented times.

Are There Consequences to Payment Holidays?

Although it was a Government initiative and reassurances were given that payment holidays agreed in advance on mortgages, loans, or credit cards would not be treated as ‘missed payments’ (and therefore not leave any adverse marks on credit files), there may be a consequence of doing so.

Whilst any pre-arranged mortgage payment holidays will indeed not be regarded as missed payments or arrears (lenders mostly use sophisticated credit scoring systems which drill down to payments which have been made and balance any changes), it is feared that when any prospective lending is taken into account, this may not turn out to be the whole story.

Even after payment holiday arrangements had ended and regular payments resumed, some lenders were always likely to factor in this information into any future credit scoring decisions which in turn may result in some applicants experiencing difficulty in accessing credit or obtaining mortgages (or indeed remortgages) for months to come.

Consequently, many professional mortgage brokers, such as ourselves here at Caboodle Finance, have been in regular contact with mortgage customers throughout the unfolding Coronavirus pandemic to ensure that clients do not then go on to make any decisions they may later regret.

Get Advice Before Taking a Mortgage Payment Holiday.

So before contemplating taking a new payment holiday or, perhaps, extending an existing arrangement, it is vitally important to engage the services of a professional mortgage broker in order to fully determine what the short or medium term implications for any subsequent applications or extensions might be.

The Importance of a Mortgage Broker Who Knows the Market.

With cumulative experience involving multiple customer scenarios, an expert broker will be able to gauge how a particular lender is likely to react in any given circumstances, which in turn will help to reduce or even eliminate the need for multiple applications to different lenders and worse, possible repeated declines.

Our team always does its utmost to ensure that clients receive great mortgage advice and consequently get access to products that are tailored to their individual circumstances; just check out our testimonials by clicking HERE

Speak to a Mortgage Broking Expert.

If you would like to know more about how we can help you with all of this, just call Caboodle Finance of Sutton Coldfield, Birmingham today on 0121 308 9114 to see how our one of our mortgage broking experts could help you. Alternatively, click this LINK to contact us via the website and one of our friendly team will be in touch as soon as possible.


Your initial consultation is free and you are under no obligation to proceed with a mortgage we recommend. There will be a fee for mortgage advice. The exact fee will depend on your circumstances and may be reduced depending on the loan amount and any commission we receive from the lender. It is estimated that the fee will be £595, but it may range from £495 to 1% of the amount you borrow. The fee is only payable on completion and can normally be added to the mortgage. This will be discussed and agreed with you before you make an application. Please ask for a personalised illustration.

Secured loan rates from 3.95% APRC, although we have plans available up to 29.9% APRC which allow us to assist customers with the most severe credit problems. The overall cost for comparison is 7.65% APRC. For secured loans a broker fee up to 10% of the loan amount borrowed may be payable on successful completion. A lender fee may also apply. The actual APRC available will depend on your circumstances. All loans are subject to status. Please ask for a personalised illustration.

The guidance and/or advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK.

Caboodle Financial Services Ltd, registered in England at Mere Green House, 46-48 Mere Green Road, Sutton Coldfield, West Midlands B75 5BT (number 08044670).
Caboodle Financial Services Ltd is an appointed representative of PRIMIS Mortgage Network (PRIMIS), a trading name of Advance Mortgage Funding Ltd which is authorised and regulated by the Financial Conduct Authority. PRIMIS is only responsible for the service and quality of advice provided to you in relation to mortgages, protection insurance and general insurance products. Any other product or service offered by Caboodle Financial Services Ltd may not be the responsibility of PRIMIS and may also not be subject to regulation by the Financial Conduct Authority. The Financial Conduct Authority does not regulate some forms of Buy to Let.

© 2020 Caboodle Financial Services Ltd