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Important Information about your Mortgage
Over the past few weeks we have received a lot of queries about how coronavirus (Covid-19) is affecting mortgages, what measures are being put in place to help those struggling financially, and how to access that support. Vintage Wealth Management are here to keep our clients up to date with the latest developments and help clarify the options available to you.
Here are 10 things you can act upon now to help manage your mortgage and support tenants during these difficult times:
1. Contact your lender. Get in touch with your mortgage provider before you miss a payment if possible. Your options will vary depending on your circumstances.
2. See if you are eligible for a payment holiday. The government has introduced a payment holiday of up to three months for those affected by coronavirus. Interest will still be charged and missed payments will either be added to the end of your mortgage term or spread out over remaining payments, depending on the agreement with your lender.
3. Speak to your tenants. Those with a buy-to-let mortgage can apply for a three-month payment holiday if their tenants are affected by coronavirus. An affordable repayment plan must be agreed at the end of the three-month period.
4. Discuss your arrears. Borrowers who were already in arrears are not guaranteed a payment holiday. Speak to your lender about other options, such as temporarily switching to an interest-only mortgage or reducing monthly payments.
5. Don’t panic about repossession. There is currently a three-month suspension on repossessions of homes or buy-to-let properties, effective from 18 March. There is the potential this could be extended, so keep in touch with your lender.
6. Go online. Customers have reported long waits on the telephone, so many lenders are increasing online communication. Check your mortgage provider’s website, as many – including Santander, NatWest and others – have set up forms to apply for payment holidays online.
7. Consider your credit file. The three-month payment holidays should not affect your credit score, but check with your lender that your credit file will not be impacted before arranging any kind of temporary relief.
8. Reassess your monthly payments. The Bank Of England has cut the base rate to 0.1%, which means payments on tracker mortgages could be significantly reduced and those on variable rates may also benefit.
9. Contact your landlord. If you are a renter who has been affected by coronavirus, speak to your landlord immediately to see how they may be able to help and keep a record of any measures suggested or agreed to.
10. Start keeping records. Lenders do not currently require any kind of proof to arrange a payment holiday, but it is wise to keep records of self-isolation dates, your personal finances, and any communication with your lender.
At Vintage Wealth Management we are here to support our clients through this confusing and ever-changing landscape. Please rest assured our advisers are reacting quickly with up-to-date information and that our priority is helping you to manage your finances during this unprecedented time.