We’ll be sharing general important notes regarding COVID-19 advances for both mortgage holders and business owners.
If you’re a client of ours we’ll be working to make contact with you if and when these changes have an impact, but by all means send us your questions and we’ll work to answer those too. Ultimately the following details are a guide, however tailored advice for your individual situation is best.
Thinking of a repayment deferral on your business loan or mortgage?
Banks have announced that mortgages will also have a 6 month window for hardship.
Our thoughts: We think that’s excellent news for those who need it, but don’t forget, this doesn’t stop interest accumulating or the loan amount increasing. Whilst postponing is going to be a requirement for some due to downturn in work or loss of job, it’s essential that people only apply if they need it.
Why you ask? Well you have to make this up somewhere.
Some banks will want the 6 month repayments straight after the postponed period, others will extend your mortgage for a further 6 months or increase your remaining monthly repayments to make up for the missed repayments. Therefore which ever way you go you are going to pay a lot more interest over the term of your loan. Outside of that, this will have implications on your credit file. With comprehensive credit reporting, your missed payments will still show up on your file, potentially restricting your borrowing power in the future. There may be better ways to get through the period so feel free to contact us first to discuss your specific case.