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Information for customers affected by
the coronavirus (COVID-19)

This page contains a range of information for customers affected by the coronavirus (COVID-19).

Extending a payment holiday

You can apply to extend an existing payment holiday if you continue to experience payment difficulties due to coronavirus (COVID-19), provided the extension won’t take you over the maximum of 6 months in total. The extension must follow on immediately from the end of your existing payment holiday and it must also end no later than 31 July 2021.

Please click the drop-down links below for more information - remember that the deferred payments will still need to be paid at a later date and interest will continue to accrue.

What is a payment holiday because of coronavirus?

It means deferring some or all of your monthly mortgage payments for a set amount of time because your ability to pay has been affected by coronavirus, you can request to extend a payment holiday for up to three months (as long as it doesn’t exceed the overall limit of six month’s payment holidays). However, it’s important to remember that you still owe these payments and they will still need to be paid at a later date. For this reason it is in your interests to make payments where you can afford to do so.

Reminder - How does a payment holiday work? How will it impact my account?

During the payment holiday, interest continues to accrue and be charged to your account, which means your outstanding balance will increase.

Where you have a capital repayment mortgage, in most cases we expect that the interest accrued during the payment holiday and the deferred capital repayments, will be paid by spreading them over your remaining term. Where you have an interest-only mortgage, in most cases we would expect that the interest accrued during the payment holiday will be added to the balance you owe at the end of the term. With a part and part mortgage, we would expect these treatments to be applied to the relevant parts of your mortgage.

In all these scenarios, you will be paying interest on an increased balance and as a result, your future monthly payments will increase. The total amount of interest you pay over the term of the mortgage will also increase.

Should you wish to pay another way, or if you think you will have difficulties making the increased monthly payments, we will provide you with the opportunity to discuss this with us before your payment holiday ends.

Whilst we are following industry and regulatory guidance to make sure a payment holiday will not have a negative impact on your credit file, lenders may take into account other information when making lending decisions, including information provided by you or bank account information. See further information below about what will happen to your credit file during a payment holiday.

Please note: requesting a payment holiday does not change your mortgage term.

Our online application form includes a calculator that can provide an estimate of what your monthly payment will be after extending your payment holiday. Alternatively, you can call us to discuss your request and obtain an estimate over the phone.

You will need to input the following details in order to use the calculator. You can find these details on your annual mortgage statement and (where applicable) your most recent interest rate change letter. Our free Self-Serve facility can also provide this information. If you are unable to find the mortgage details required, please contact us and we can provide them to you.

  • monthly mortgage payment
  • current interest rate
  • remaining term in years and months
  • repayment type (i.e. capital repayment or interest only)

If you have multiple parts to your account, (e.g. a part capital repayment-part interest only mortgage or differing interest rates on sub-accounts), then the calculator may not provide an accurate estimate of your new monthly payment and you may find it beneficial to call us to obtain a more accurate estimate. If you have any problems using the calculator, please call us so that we can provide you with an indication of the impact of the payment holiday on your monthly payments.

Payments due and suspending or changing payments

If a payment holiday is extended, and you usually pay by Direct Debit you do not need to do anything, once the payment holiday is processed, the payment will not be collected. Please do not cancel your Direct Debit, without contacting us to discuss this first, as we won’t be able to take your new monthly payment when the payment holiday ends, which might mean you miss payments when they restart.

If a payment holiday is arranged and you pay by standing order, or if you have a recurring payment set up through online banking, then you will need to contact your bank either to cancel it - to avoid payments being made during the payment holiday - or to reduce the amount of your payment - if you want to make payments where you can afford to do so.

Remember, you will need to reinstate the standing order or recurring payment at the end of the payment holiday, ensuring that it is set for your revised monthly payment amount.

During a payment holiday, if there is an interest rate change, or if a transaction occurs that results in a recalculation of your monthly payment, we will still send out a letter advising you of the change to your monthly payment. However, if you have a payment holiday arranged, then the payment will not be collected or be payable and you will be advised of your further revised monthly payment towards the end of your payment holiday.

What if I can afford to make some form of payment?

Paying what you can afford either monthly, or whenever you can afford to do so means that the impact of the payment holiday on your balance will be reduced. So any increase in your future monthly payments will be smaller and the amount of additional interest you pay as a result of the payment holiday will be reduced.

Visit our Payments page to see details about ways you can make these payments – for example, through online banking, our Self-Serve facility or Standing Order (but not Direct Debit). You can still call us to make payments by debit card. If you choose to do this, please use our automated card payment facility as our telephone lines will continue to be busier than usual and we would like to be able to prioritise our most vulnerable customers.

If your account is currently in arrears, any payments received during the payment holiday will be used to reduce the arrears first.

Where can I find help with budgeting and finances?

If you are worried about money or debts you need to set a realistic budget. Make a list of your debts and work out which ones are highest priority and which are less important. For most people, it makes sense to pay essential expenses and priority debts before any discretionary expenses or non-priority debts.

The Money Advice Service has developed a Money Navigator tool, designed to help people whose finances have been impacted by COVID-19, such as those facing redundancy, self-employed or freelance workers whose income has been affected and people who have experienced a temporary drop in their income.

The tool will also help users find support from other organisations such as National Debtline, Citizens Advice, PayPlan, StepChange and others.

You can also find out what services are available across the UK, including what face to face support is available in your local area using the Debt Advice Locator tool, designed by the Money Advice Service, at www.moneyadviceservice.org.uk/en/tools/debt-advice-locator.

The StepChange debt charity has also published a reduced income guide to help people with a reduced income deal with their finances. We recommend you read this and take any action you need to sooner rather than later.

See our 'Help with Financial Difficulties' page for details of independent not-for-profit organisations, including Citizens Advice and the Money Advice Service, for further guidance on money, debt, housing and employment.

If I extend my payment holiday what will happen to my credit file?

Please note: Whilst we are working on the basis of industry and government guidance to ensure that the payment holiday will not adversely impact your credit file, we cannot guarantee how other lenders will interpret the payment holiday when assessing any future lending decisions. Lenders may take into account other information when making future lending decisions, including, for example, information provided by you as an applicant and bank account information.

If your account is currently up to date, then your credit file will continue to reflect this status, as long as you keep up with your monthly payments.

If you are currently in arrears, then your credit file will continue to reflect the same arrears status during the payment holiday as immediately prior to it. We will continue to send monthly arrears letters, as your previously missed payments are still outstanding.

What if I’m in arrears?

You can request a payment holiday extension but you may wish to discuss your circumstances with us before you apply. During a payment holiday we continue to send monthly arrears letters, as your previously missed payments would still be outstanding.

When will the payment holiday take effect?

We will do our best to ensure your payment holiday continues in line with your request. However, due to the high volume of requests being received it may take us longer than usual to process your request. Once your request is processed, we will write to you to confirm its start date.

If you do want to apply to extend your payment holiday and your next monthly payment is due in the next seven working days, please don’t use the online form and call us to apply.

 

Applying for a payment holiday

When you have read all of the information above, you can apply to extend an existing payment holiday by completing our online application form, or you can call us to apply if you’d prefer to do so or if your only account is an unsecured loan.

Please note: We are currently dealing with a higher number of calls from customers than normal. So that we can support those in the most vulnerable situations please only call if your enquiry is urgent. You can use our Self-Service facility online to view details of and to manage your account. We are doing our best to help customers as quickly as possible and we appreciate your cooperation.

Please read all the information above carefully before you apply for a payment holiday extension.

 

What happens at the end of my extended payment holiday?

After your payment holiday ends, you need to start making your monthly payments again. In the final month of your payment holiday, we will write to you before your next payment is due to explain the impact of the payment holiday on your account and to provide details of your revised monthly payment amount.

How do I start making payments again?

If you previously paid by Direct Debit and the Direct Debit hasn’t been cancelled by you, we will automatically collect your payments again by Direct Debit. If you previously paid by standing order or another method, or cancelled your Direct Debit, you will need to make arrangements to restart your monthly payments ensuring that they are set for the revised monthly amount detailed in our letter to you.

What if I am still struggling to make payments?

If you will continue to have difficulties in making your mortgage payments at the end of your extended payment holiday due to coronavirus you can apply for an additional extension, providing the extension won’t take you over the maximum of 6 months.

The extension must follow on immediately from the end of your existing payment holiday and it must also end by 31 July 2021. It’s important to remember that you will still owe these payments and the payments already deferred; both will still need to be paid at a later date. Again, you will be paying interest on an increased balance and as a result, there will be a further increase in your future monthly payments. The total amount of interest you pay over the term of the mortgage will also increase. For this reason, it is in your interests to make some form of affordable payments even if you request a further payment holiday.

  • A temporary concessionary arrangement - allowing you to pay a reduced contribution towards your monthly payment, for an agreed period. The shortfall in your monthly payments will fall into arrears which could lead to additional fees being charged and notification of the level of arrears being reported to credit reference agencies. The arrears would also need to be repaid later, through a further payment arrangement.
  • A temporary conversion to interest only (only applicable if you have a repayment account) - the monthly payment could be recalculated to just cover the interest that is due, for an agreed period. At the end of the temporary conversion your payments will be recalculated again. As the unpaid capital will be getting repaid over a shorter term, this will cause a further increase in your future monthly payments.
  • Extending your mortgage term (only applicable if you have a repayment account and where mortgage terms and conditions allow) - the monthly payment will be recalculated and will reduce because your balance is being repaid over a longer period. However, this option will also increase the amount of interest you have to repay overall.

If you are in long term financial difficulties, or have already taken a payment holiday up to the maximum of 6 months, and are unable to resume mortgage payments, please provide income and expenditure information so that we can assess your circumstances and provide you with continued support. You can provide us with your information online here. We will then contact you to discuss the options available to you. You can also contact us by telephone if you would like to discuss these options.

Do I have options for paying back the deferred payments in a different way?

The letter we will send to you towards the end of your payment holiday will outline alternative options for paying the deferred payments (on a voluntary basis). These may include:

  • Single lump sum overpayment - repaying all deferred payments in a single payment.
  • Partial lump sum overpayment - repaying some deferred payments in a single payment with only the remaining deferred payments being paid over the remaining term of your account.
  • Monthly agreement to pay - you can offer to pay more than your new monthly payment to reduce the deferred payments on a monthly basis. How long it takes to repay the deferred payments will depend on how much you offer to pay each month in addition to your monthly payment.
  • Partial lump sum overpayment followed by a monthly agreement to pay - repaying some deferred payments in a single payment followed by an offer to pay more than your new monthly payment to reduce the remaining deferred payments on a monthly basis.
  • Extending your mortgage term (only applicable if you have a repayment account and where mortgage terms and conditions allow) - the monthly payment will be recalculated, reverting to approximately what it was prior to the payment holiday. However, this option will also increase the amount of interest you have to repay overall.

Repaying Pre-Existing Arrears

If your account was in arrears before your payment holiday, you will need to make arrangements to repay these. We will always provide a reasonable amount of time for you to repay the arrears.

If you are not in a position to clear the arrears in full, but are able to pay your full monthly payment as well as making monthly contributions towards them, then we can consider a payment arrangement with you that takes account of your circumstances. We will need to update of your income and expenditure information so that we can assess your circumstances to provide you with continued support.

You can provide us with your information online here. We will then contact you to discuss a payment arrangement with you. You can also contact us by telephone if you would like to speak to us about your circumstances and options.

 

Other Information

You may find the information below helpful at this time.

Help with payment difficulties

Please see our Help with payment difficulties page for help and support.

The StepChange debt charity has published a reduced income guide on their website that aims to help people deal with a reduced income due to the coronavirus.

Other ways to make your monthly payment

Perhaps you are having trouble making your monthly payment because of ongoing movement restrictions or illness / isolation. Please see our dedicated Making your monthly payment page for information about all the different ways to make your monthly payments, including our online Self-Serve facility.

Requesting further support or getting a third party to help you manage your account

In addition to any payment difficulties you may be experiencing please contact us, as soon as possible, to let us know if there is anything else that we need to be aware of, or consider, when administering your account. This may include any specific issues you are facing that is causing your payment difficulties or that may be impacting your ability to communicate with us regarding your account.

If you are finding it too difficult to manage your account during this period, or would simply like additional support in dealing with your account from a third party (such as a friend or family member) you may wish to consider setting up a third party authority to allow us to deal with someone who is able to assist you in respect of your account.

To enable a third party to support you with your account, please complete and sign the Third Party Authority form.

Please note: if you would like the nominated third party to act for you and other customers named on the account, all other customers named on the account will also be required to sign the form. In addition, please ask your nominated third party to complete their details and provide a signature in the relevant sections of the form.

Where the nominated third party is an individual their signature confirms that they have received a copy of our Privacy Notice.

Coronavirus and your mental wellbeing

The mental health charity MIND has produced a helpful guide - Coronavirus and your wellbeing - which aims to provide information to support anyone who is feeling anxious about coronavirus. It might be helpful to those who are self-isolating or working from home.

Since the original lockdown began in March 2020, there has been a significant rise in incidents of domestic abuse. The government issued guidance on their website to support victims of domestic abuse and launched a social media campaign to publicise the availability of support:

#YOUARENOTALONE

It is estimated that 95% of domestic abuse victims also experience economic abuse. If someone else is controlling your finances or stopping you from controlling your finances, the charity Surviving Economic Abuse has also provided additional guidance and support on their website.

Be aware of scams

Unfortunately, fraudsters are using the coronavirus pandemic as an opportunity to defraud individuals. Take Five is a national campaign that offers straight-forward and impartial advice to help everyone protect themselves from preventable financial fraud. They have published a scam alert on their website to help individuals spot and avoid scams in relation to coronavirus.

More information about the COVID-19 virus

Details of the Government's response to coronavirus can be found on the UK government website.

 

Please note: the above content includes links to websites operated by external third party organisations and as we do not have any control over the content of these external websites, we cannot accept any responsibility or liability in respect of the material provided to you on such websites.


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