Call on 0115 947 5545 | | Client Login

Mortgage payment holidays: the facts

Mortgage payment holidays: the facts
March 31, 2020 Amy Cooper
mortgage payment holidays

With Covid-19 having financial implications for many households across the UK, a high number of people may be feeling concerned about keeping up with mortgage payments in the coming months. As such, the government’s promise of a three-month mortgage payment holiday for those in need could be an option worth considering. In this article, George Square Financial Management takes a closer look at what a mortgage payment holiday is and outlines the eligibility criteria for the new measure.

Mortgage payments make up a considerable part of monthly outgoings for many people across the UK. With a number of these people now unable to work as a result of Covid-19, making these monthly payments may now be a serious cause for concern.

For those who are facing financial hardship due to the coronavirus crisis, the government is implementing mortgage payment holidays. This will allow you to stop or reduce your monthly payments for up to three months and should have no detrimental effect on your individual credit rating.

What is a mortgage payment holiday?

A mortgage payment holiday is an agreement made with your lender that allows you to temporarily stop or reduce your monthly mortgage repayments. It is important to note that the lender is not paying the borrower’s mortgage for them during this time. Mortgage payments are instead being deferred into the future, and interest still accrues for the three-month period.

Any repayments you don’t make over the three months will need to be made at a later date. It is likely the lender will spread outstanding payments out over the remaining term of your mortgage, so borrowers will typically see a small uplift in future payments.

Am I eligible?

You could be eligible for a mortgage payment holiday if:

  • Your finances have been affected by coronavirus
  • You are up to date with your monthly mortgage payments and not in arrears
  • You have consent from everyone named on the mortgage

For those who are eligible, lenders should aim to minimise the long-term impact of arrears and ensure the mortgage remains affordable and sustainable. For those who are already in arrears or in financial difficulty, lenders should consider the full range of options ordinarily available to customers under existing rules.

Get in touch

A payment holiday may not be suitable for everyone. If you’re not yet sure how much the current situation will impact your finances, there is still time to consider the best option for you. Our team of financial advisers would be happy to provide further guidance on mortgage payment holidays, as well as other alternatives available.

Although our office is currently closed, our advisers are still here to support you with your financial matters. You can contact our dedicated mortgage adviser Rebecca Smith on 07799 480 426 or via email at

Additional government guidance on Covid-19 can be found here.