With the impact of Coronavirus being felt across the country, our aim is to ensure your peace of mind when it comes to your money.
We understand that many people may be worried about their finances at this time. Together we are working with the Government to make sure that we are giving you the support you need with your mortgage payments.
You should speak with us in good time before your next payment is due.
If you are worried about meeting your mortgage payments, we can offer a variety of solutions, including payment deferrals. We will need to speak with you before a payment deferral can be put in place.
A payment deferral means you agree with us that you will not have to make mortgage payments for a set amount of time. Whilst your mortgage contract with us does not feature payment deferrals as an option, we understand that the coronavirus situation will have created difficult financial situations for many of our members, which is why we are offering the option of a payment deferral for up to three months for additional support in these exceptional circumstances.
Call us on 0800 072 1100 and select option 2 for mortgages and then option 2 for payment difficulties – we feel confident that we can work with you to explore different options which may help.
WE WILL NEED TO SPEAK WITH YOU BEFORE A PAYMENT DEFERRAL OR TAILORED PLAN CAN BE PUT IN PLACE
You must be up-to date with your payments for us to consider you automatically eligible for a payment deferral. If your account is in arrears we will still be able to help you, but we will need to talk to you first to assess your circumstances and work together to find the best solution for your needs and your best interests.
It is important to remember that you still owe the amounts that you don’t pay as a result of the payment deferral. Interest will continue to be charged on the amount you owe. This means that, at the end of the payment deferral, you will have to make up the missed payments and the amount of interest you pay over the term of the mortgage will increase. We will give you an estimate of the impact on your mortgage when we speak with you to set up a payment deferral. If you are able to make part of your normal mortgage payment to reduce the money you owe then we advise you to consider doing so.
You should not apply for a mortgage payment deferral if you are not experiencing or do not reasonably expect to experience payment difficulties.
How will the missed payments be repaid?
If you are currently up-to-date with your mortgage payments, at the end of the payment deferral we will recalculate your monthly payment based on your outstanding balance and remaining term. We will do this automatically unless you tell us this is not what you want to do (‘opt-out’) and you would like to discuss possible other ways to repay the unpaid instalments. If you want to discuss other possible options, please wait for us to contact you.
If you decide to add the unpaid instalments to your existing balance, your payments will increase and the amount of interest you pay over the term of the mortgage will increase – we will tell you the actual amounts before the end of the payment deferral. If you choose this option and you think you are going to struggle with the new payments then let us know and we can discuss other options with you at that time.
We want to ensure that payments are affordable for you, so if you currently have arrears on your mortgage, we will contact you before the end of the payment deferral to agree on how to repay this money. In order to do this, we will need to assess your individual circumstances, including your income and expenditure and arrange a specific agreement to pay.
What evidence do I need to provide
If you are currently up-to date with your mortgage, all you need to do is tell us how your income has been affected, either directly or indirectly.
If you currently have arrears on your account, we will need to speak with you to understand your individual circumstances. If you are able to, please complete the personal budget form here in readiness for the call. If you would like support with this form, we can go through this whilst we are on the phone, or contact us for Open Banking options that may help you.
Buy to Let Mortgages
We can consider a payment deferral if your tenant has been affected. The payment deferral is intended to support your tenant whilst they are impacted by the Coronavirus, and you are expected to pass on this relief on to your tenant to ensure they are supported during this time.
What to do about Direct Debits
You should not cancel your direct debit without confirming the payment deferral with us first. Cancelling your direct debit without speaking to us does not qualify as a payment deferral and will be counted as a missed payment. The payment deferral will only take effect once you have spoken to us and come to an agreement.
Your credit file
The payment deferral will not be reported as missed payments on your credit file with Credit Reference Agencies. This should minimise the impact on your future credit prospects, but does not mean that your ability to access credit will be unaffected in future, as lenders may take into account other information when making lending decisions, including information provided by you or bank account information for example. This means that there are other ways lenders can tell whether you have taken a mortgage payment holiday, which could impact future lending decisions.
If your account hasn’t been in arrears prior to or after the payment deferral and you meet our usual criteria, we can arrange a product switch for you.
If your mortgage has already been the subject of Court action, and the court has already ruled that we are entitled to take possession of your property, we will not take further steps to seek a warrant for possession before 1 February 2021. However, interest will continue to be charged, which means it is likely that you will get less back (or owe us more) when the property is repossessed and sold by us. Please contact us if you want to discuss this, or want to take steps to sell the property earlier.
If property prices decrease between now and the time your property is sold, then you may get even less back, or nothing if your property is sold for less than you owe.
Whilst repossession is always a last resort, from 25 November 2020, we will recommence taking court action for repossession proceedings to seek court ruling that we are entitled to take possession of your property if we haven’t been able to resolve the problem with you. In these circumstances, although the court may rule that we are entitled to possession of your property, we will not take further steps to seek a warrant for possession before 1 February 2021. It is never too late to contact us to seek to resolve problems, talking to us as soon as you can gives us a chance to look at as many different options as we can.
How to Apply for a Payment Deferral
Please telephone 0800 072 1100 and select option 2 followed by option 2 or visit our Payment Difficulties page.
Other Sources of Information
If you require support with navigating your finances, there are many types of free and impartial money guidance and debt help available to you, on-line, by telephone and face to face. We would encourage you to use the on-line services first as these can provide you with the quickest response.
You can find more help to manage money and debt from the following sources:
Money Advice Service
Tool to work out a budget to help you take control of your money: https://www.moneyadviceservice.org.uk/en/tools/budget-planner
Tool which provides guidance according to your personal needs and which in a matter of minutes can inform you what extra help and support you’re entitled to, help you understand the money issues you need to tackle first, how to stay on top of bills, and where you can get more free advice for debt, housing or redundancy: https://www.moneyadviceservice.org.uk/en/tools/money-navigator-tool
Impartial information on payment deferrals
Online guides on how to prioritise your debts
For most people, it makes sense to pay essential expenses and priority debts before any other non-priority debts or non-essential spending. To see what is right for you, you can use this guide on how to prioritise your debts: www.moneyadviceservice.org.uk/en/articles/how-to-prioritise-your-debts
Debt Advice Locator
Help to locate debt advice, online, by telephone or face to face: https://www.moneyadviceservice.org.uk/en/tools/debt-advice-locator
Financial Conduct Authority
FAQ's to support mortgage customers during Covid-19