According to a report in the Daily Express, figures close to 3 million struggling homeowners could be asking their mortgage lenders for a mortgage payment break due to the financial crisis gripping the world at the moment.
Property experts and mortgage advisors do warn however that although having a mortgage holiday or requesting a mortgage payment break might seem a good idea, people need to understand the implications of this.
Firstly, whilst you take your mortgage break or holiday, the interest is still being applied to your mortgage – something which sometimes surprised students on CeMAP training courses. This means that when you come back to start making mortgage payments again, the actual monthly repayment figure may have increased and the equity in your home will have dipped. As house prices are predicted to fall next year it might mean that this brings you under the minimum loan to value required by your mortgage lender or that you might struggle to remortgage when it comes to the end of your deal.
Flexible offers like this are certainly attractive and very useful, just be aware of the consequences and make the decision carefully.
