With uncertainty in the markets and the credit crunch putting a squeeze on our daily finances, homeowners have faced difficult circumstances when it comes to the financial implications of owning a home.
One of the most common methods for helping to ease financial uncertainty is a payment holiday. With rising unemployment levels and the financial markets going through a turbulent time, many banks and building societies are under pressure to pass on savings to customers and help eliminate some of their personal debt.
Mortgage rates and other financial products in the UK have fluctuated during this difficult time, with property values and also the cost of home insurance seeing big rises in response to the financial climate. With the government now putting pressure on banks to pass on savings to customers, calls to the Consumer Credit Counselling Service have increased in recent weeks, with many consumers seeking solutions to their financial problems.
Payment holidays can be saving a grace if you’re struggling with payments on your mortgage, and also during situations such as wedding preparations and bereavements, however many are put off by the fear of asking the bank in the first place, and with market conditions the way they are many believe it to be unlikely that they will agree to such terms.
But with the government putting pressure on banks to help ease the financial difficulties of their customers – particularly with Christmas approaching – approaching your bank to arrange a payment holiday doesn’t have to be a scary experience. And during difficult times – such as unemployment – these can be useful in helping you keep your finances on track.
It’s important to do some research before applying for such a plan, with some banks having different policies with regards to ownership of the property, payment history and employment situations. Be sure to analyse your current financial situation, being wary that a lengthy payment holiday on mortgages could aid in raising the interest on your current policy, so it’s better to be sure that you’re in a relatively stable situation before committing to any deals.
