Deferring a mortgage payment

Potential-Monke

I'm not looking for financial advice, I'm just wondering if anyone ever has, or has ever heard of being able to, defer a single mortgage payment. I pay the mortgage every month, on time, no problems, but this December is going to be a tight one (and i'm not even buying any Christmas presents!) and it would make a world of difference if i could defer the payment that month and stick on an extra one at the end!

It's something i only imagine i will be doing once, as i'll know better next year and plan properly, but things got up on me (my own fault, i'll admit) and i'm not well set. The problem is that the mortgage will go out on the 8th, and my last weekly wage will be on the 22nd, and nothing again until the 8th of Jan when the next mortgage payment will go out, which will cancel out my wages.

So, has anyone done, or heard of anyone that has, deferred a payment?

phormium

Worth a call to the bank, in theory most banks would probably agree to something that might help you out eventually, the problem is the time span. A request like this will more than likely have to go through the MARP system as the bank will probably process it as a pre arrears situation, this will result in tons of info required and decision not made for weeks and weeks. Some banks are quicker than others but the issue might be that the payment date will be well gone and the payment debited before you will have received an answer.

Potential-Monke

Cheers for that. I'm going calling into them today to see if i can sort something.

dotsman

If it's just a temporary cashflow issue, would an overdraft (as long as you pay it back over the following few months) or credit union loan be a lot easier and cheaper?

The problem with deferring a mortgage payment (as phormium has indicated) is that it could take a while for the request to be processed as there is considerable bureaucracy and regulations relating to mortgages and there is a chance that your bank may not oblige. Also deferring a single payment could cost a considerable amount in the long term as the interest builds up over the term of the mortgage. To give an idea of the cost, if you are to assume that the average interest rate you will pay over the life of the mortgage is 5% (could possibly be higher!) and there is 25 years remaining, you will end up paying approx 3.4 times the amount of that repayment (ie, if your repayment is currently €1,000, you will end up having to pay an extra €3,400 at the end). Of course, inflation would eat away at some of that, but you should still be aware of the costs of the request.

Power2011

Potential-Monke wrote: »

Cheers for that. I'm going calling into them today to see if i can sort something.

How did u get on ? I heard it could take upto 8 weeks

Potential-Monke

Already have a CU loan, can't get another one. And i have an overdraft which i'm constantly in. The bank are making savage money off me! Also, i realise now (thanks to you dotman) that it will cost me more in the long term, but i need to do something now rather than possibly missing a payment, as i'm not exactly on the breadline, but i could just use a small bit of help this/next month, and i'm start working hard next year to organise myself a bit better.

Called into them and yer man said that it could take up to 8 weeks as there are a very high number of requests going in at the moment. The place that makes the decision is currently recruiting about 10 people a week to keep up with the overflow. Plus, he said there were a lot of people chancing their arms, looking for a decrease in payments and then their bank statements showing a holiday to France haven been booked, etc. I explained my situation to him, and the reason for the request, and he reckons that if i'm being truthful, it shouldn't take more than 4 weeks for a decision.

So i'd to fill up an SFS (Standard Financial Statement), include 3 recent payslips and 3 months bank statements (which i could get by downloading online at no cost). Sent them back in with a cover letter explaining what i am looking for and why. The SFS was showing that i should have a surplus of €235 a month, but i used minimum figures and i couldn't even answer some of them (how much do i spend on clothes a month, absolutely no idea!).

So all going well, i should hear back mid-December, and the man in EBS was also hopeful that they should be able to sort me out, as i'm a genuine case and not looking for anything other than skipping 1 months payment. He also mentioned that i might be able to get 3 months without paying, and if i could i would be able to pay off some debt that will make my life a lot easier. So i'll update this as soon as i have any more info.

Potential-Monke

Forgot to update this. Not exactly what i was looking for, but they're giving me interest only for 3 months, with the option to extend for another 3. Saving me €200 appx a month. Better than nothing!

greenman09

Some banks do the flexible options. You could have been offered a payment holiday of up to 3 months without going down the sfs process. Depends on the bank tho. Would have changed ur repayments slightly but not drastically