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Buy to let mortgage - no pause

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  • 20-03-2020 10:39pm
    #1
    Registered Users Posts: 7,739 ✭✭✭


    Small question about rent payments for any landlords here that might be able to help me

    Landlord is unwilling to pause rent payments for us because of the fact it's a student let and because college isn't paused the bank is of the view there is no break, at least that's what she is telling us

    Is this reality or is the landlord pulling the wool on us? Not sure what to think


Comments

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


    It's simply a deferral of payments rather than a pause. How are you proposing to catch up on the paused rent? That might be whats influencing the decision.


  • Registered Users Posts: 7,739 ✭✭✭SureYWouldntYa


    Deferral and pause means much the same thing does it not in these circumstances?

    I know it leaves the mortgage in the same place so it makes no odds to the mortgage whether we pay for 3 months now or some other tenant pays for 3 months at the end if there was a break/pause/whatever its called, except for the fact its paid off 3 months earlier


  • Registered Users Posts: 1,016 ✭✭✭JJJackal


    Deferral and pause means much the same thing does it not in these circumstances?

    I know it leaves the mortgage in the same place so it makes no odds to the mortgage whether we pay for 3 months now or some other tenant pays for 3 months at the end if there was a break/pause/whatever its called, except for the fact its paid off 3 months earlier

    Actually a deferral would not leave the mortgage in the same place, unless interest is also suspended.

    The money that would have been paid back via the mortgage will be subject to interest as will the accumulated unpaid interest?


  • Registered Users Posts: 7,739 ✭✭✭SureYWouldntYa


    JJJackal wrote: »
    Actually a deferral would not leave the mortgage in the same place, unless interest is also suspended.

    The money that would have been paid back via the mortgage will be subject to interest as will the accumulated unpaid interest?

    I'd have just assumed interest would be suspended for mortgages tbh, didn't know it was a possibility of the interest still being due and the it's only the principle paused


  • Registered Users Posts: 1,016 ✭✭✭JJJackal


    I'd have just assumed interest would be suspended for mortgages tbh, didn't know it was a possibility of the interest still being due and the it's only the principle paused

    I presume you would be charged interest on interest if not paying? if that makes sense?


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  • Registered Users Posts: 7,739 ✭✭✭SureYWouldntYa


    JJJackal wrote: »
    I presume you would be charged interest on interest if not paying? if that makes sense?

    For a normal "pause" on the mortgage that of course makes sense, but I thought the whole point of it was to give people a break with the uncertainty now and in the coming months, but if the interest is still due then I can see a lot of landlords keeping things as is where they can since it actually does matter now unlike what I was thinking


  • Registered Users Posts: 14,524 ✭✭✭✭Dav010


    Would this apply to a property rented by students? Most students are not employed so income is not effected.

    Also op, if the owner has not financed the property, it is a 3 month loss of income, also, if the property is sold before the mortgages term has elapsed, it is also a 3 month loss.


  • Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    The banks don't care who the tenant is. All their offering to do is not report anybody who doesn't pay for three months to the Central Credit Register and what they are planning to do is to capitalise the payments forgone and adjust the repayment schedule so that the loan ends at the time originally anticipated. This means the mortgagor will have higher repayments and more interest to pay until the end of the loan after availing of the 3 month "holiday".


  • Registered Users Posts: 8,485 ✭✭✭Quantum Erasure


    Dav010 wrote: »
    if the owner has not financed the property, it is a 3 month loss of income, also, if the property is sold before the mortgages term has elapsed, it is also a 3 month loss.

    why are mortgage payments being deferred anyway?


  • Registered Users Posts: 1,417 ✭✭✭Diemos


    Deferral and pause means much the same thing does it not in these circumstances?

    I know it leaves the mortgage in the same place so it makes no odds to the mortgage whether we pay for 3 months now or some other tenant pays for 3 months at the end if there was a break/pause/whatever its called, except for the fact its paid off 3 months earlier

    Not at all.
    The 3 months a tenant gets for 'free' has to be paid some how.
    If a landlord has no mortgage, then the loss is immediate, 3 months income is gone immediately.
    If they have a mortgage then the loss wont be felt until the final 3 months or the property is sold.
    So the landlord will take the hit, it is just a question of when.

    So it's a very challenging time for everyone tenants and landlords. If a tenant has a proven track record of good payment and they have been adversely affected by this situation, there is not a soul in this country who believes that that person should be punished for the situation that they find themselves in, while it may be popular in some corners, screwing landlords isn't the answer either.


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  • Registered Users Posts: 23,524 ✭✭✭✭ted1


    Small question about rent payments for any landlords here that might be able to help me

    Landlord is unwilling to pause rent payments for us because of the fact it's a student let and because college isn't paused the bank is of the view there is no break, at least that's what she is telling us

    Is this reality or is the landlord pulling the wool on us? Not sure what to think

    Why do you need a pause ? Have you been put out of work ?


  • Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    Diemos wrote: »
    Not at all.

    If they have a mortgage then the loss wont be felt until the final 3 months or the property is sold.
    So the landlord will take the hit, it is just a question of when.

    The 3 months will be capitalised, so the landlord will immediately have a higher loan with higher interest and capital repayments, when the repayment schedule begins again. This will be against a backdrop of falling rents so the landlord will find himself in a much worse situation afterwards.


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