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moratorium period

  • 08-02-2019 9:40am
    #1
    Kurn
    Registered Users, Registered Users 2 Posts: 878 ✭✭✭


    AIB have asked me if I want a moratorium period on my mortgage? Can someone explain this term to me, please?

    From a google search, it seems to be interest only repayments up to 6 months. Is this a good idea?

    Thanks for any information in advance.


Comments

  • #2
    Samuel T. Cogley
    Registered Users, Registered Users 2 Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    It's potentially a good way to get you started in a new place, but all you're doing is kicking the can down the road in terms of repaying the mortgage and paying more interest.


  • #3
    awec
    Administrators Posts: 54,424 Admin ✭✭✭✭✭awec


    It means you don't pay your mortgage for up to 6 months after moving in. It means your 30 year mortgage becomes a 29.5 year mortgage. Your repayments will go up slightly (not much) to account for the slightly shorter time period.

    It can be useful if you feel you would need the extra cash when you move in to furnish or whatever.


  • #4
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    I got one for 3 months on my first property - no repayments at all for 3 months.

    It was worth it to me at the time because I was young without much of a financial cushion and buying had fairly cleaned me out so it gave me a chance to buy a few bits for the house initially before the pressure of the mortgage repayments kicked in.

    It is just kicking the can down the road and the missing payments are added on at the end. Im not sure if you will pay more interest - depends on what the offer is - mine was a moratorium on both interest and payments.


  • #5
    L1011
    Registered Users, Registered Users 2 Posts: 71,186 ✭✭✭✭L1011


    I was given 3 months without any say in the matter back in 2012. Was useful because I bought a wreck but I'm fairly certain interest was charged on the time, term wasn't extended so payments are (marginally) higher as a result.


  • #6
    awec
    Administrators Posts: 54,424 Admin ✭✭✭✭✭awec


    ....... wrote: »
    I got one for 3 months on my first property - no repayments at all for 3 months.

    It was worth it to me at the time because I was young without much of a financial cushion and buying had fairly cleaned me out so it gave me a chance to buy a few bits for the house initially before the pressure of the mortgage repayments kicked in.

    It is just kicking the can down the road and the missing payments are added on at the end. Im not sure if you will pay more interest - depends on what the offer is - mine was a moratorium on both interest and payments.
    This is what AIB offer, it's no payment at all for up to 6 months, but the rest of your payments go up a very small amount.


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  • #7
    Kurn
    Registered Users, Registered Users 2 Posts: 878 ✭✭✭Kurn


    awec wrote: »
    This is what AIB offer, it's no payment at all for up to 6 months, but the rest of your payments go up a very small amount.

    Thanks for all this info everyone.


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