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Mortgage payment holidays: next steps

See what your options are as your payment holiday comes to an end

Before your payment holiday ends, we’ll get in touch by letter to explain your options. You’ll need to wait until you receive this letter before deciding what you want to do.

The letter you receive will let you know your new monthly payment. You may find your monthly payment will increase after your payment holiday. That’ll be because:

  • interest has continued to accrue and been added to your outstanding mortgage balance during your payment holiday
  • there will be fewer months of your mortgage term remaining for you to repay your balance

If you have any questions around the information in your letter, take a look at our Frequently Asked Questions.

If you haven’t heard from us yet, find out more about your options.

And if you haven’t taken a mortgage payment holiday, but would like to, see how to apply.

What if you want to review your new payments?

Here are some options that may either:

  • extend your payment holiday (this could mean you end up paying more over the term of your loan)
  • make your new monthly payment easier to manage
  • allow you to reduce your overall balance and the interest you’re charged

If you’re comfortable with your new monthly payment and don’t want to explore one of these options, your regular monthly payments will recommence and you don’t need to do anything.

Your options

The options below could help you to reduce your monthly payments, or reduce your overall balance. There is also the option to apply to extend your payment holiday. An extension would not reduce your future monthly payments and would increase your balance.

If you feel you won’t be able to begin making payments in 3 months’ time, or need additional support, it’s important to let us know as soon as possible.

Extend the term (length) of your mortgage

If you have a capital repayment loan (rather than interest only), you may be able to extend the term (length) of your loan by up to 6 months. This could help reduce your monthly payments so they’re closer to the amount they were before you took your payment holiday. 

How it works

The table below helps illustrate how your monthly payments could change by extending the term of your loan up to 6 months. This table uses rounded figures.
Loan balance £150,000 £250,000
Remaining loan term 15 years 30 years
Interest rate 2% 2%
Monthly payments before extension £965 £924
Monthly payments after 6 month term extension
£939 £913
Decrease to monthly payments £27 £11
Future total cost of borrowing £174,573
£334,156

Additional interest payable 

(included in future total cost of borrowing)

£826 £1,499
The table below helps illustrate how your monthly payments could change by extending the term of your loan up to 6 months. This table uses rounded figures.
Loan balance Remaining loan term
£150,000 15 years
£250,000 30 years
Loan balance Interest rate
£150,000 2%
£250,000 2%
Loan balance Monthly payments before extension
£150,000 £965
£250,000 £924
Loan balance Monthly payments after 6 month term extension
£150,000 £939
£250,000 £913
Loan balance Decrease to monthly payments
£150,000 £27
£250,000 £11
Loan balance Future total cost of borrowing
£150,000 £174,573
£250,000 £334,156
Loan balance

Additional interest payable 

(included in future total cost of borrowing)

£150,000 £826
£250,000 £1,499

Next steps

1. To see the likely change to your monthly payments by extending the term of your mortgage, enter your revised payment details from your end of payment holiday letter into our calculator.

If you're unable to view the calculator, or would like to discuss the possibility of extending your term for longer than 6 months, please call us.

2. Once you’ve used our calculator to illustrate the likely financial implications of extending your loan term by up to 6 months, if you’d like to apply, you can do this online or by calling us. Please note, if you apply to extend your term, you won’t be able to extend your payment holiday.

Switch to a different mortgage rate

If your current fixed rate mortgage is coming to an end, and you're on a HSBC Variable Rate, HSBC Buy to Let Variable Rate or a tracker rate, we can help you switch to a new HSBC mortgage rate. Depending on your circumstances and the interest rate you choose, switching rates may reduce your monthly payment.

How it works

Step 1 – Review your current interest rate. If you’re on a fixed interest rate and are looking to switch, there may be early repayment charges depending on how long your rate has left.

You can find these details on your mortgage statement, or offer. You can also see them by logging on to online banking and looking under ‘My Accounts’.

There are no early repayment charges if you're on the HSBC Variable Rate, or HSBC Buy to Let Variable rate.

Step 2 – Find and compare our current mortgage rates, or view all our mortgage rates.

Next steps

You can either apply online if you don’t need advice, or call us to book an appointment so we can review your financial circumstances and help find the best rate for you.

See more information about switching rates.

Make an extra payment

If you have funds available, you could make an extra payment to reduce your capital balance. This could also reduce your monthly payments.

How it works

The letter you’ll receive confirms the amount of interest that has accrued and been added to your balance during your payment holiday. By paying this amount, or any other sum, you’ll reduce the balance of your loan on which interest is charged and your monthly payment. 

We'll ensure you're not financially impacted by making up the payments you haven’t made during your payment holiday. So, any early repayment charges related to these payments will be waived. 

Next steps

You can call us to discuss making an extra payment. We’ll be able to tell you what impact it would have on your monthly payment. We can then arrange this for you if you want to go ahead.

Apply for a payment holiday extension of up to 3 months

If you've already taken a mortgage payment holiday, you may be able to apply to extend it for up to another 3 months.

Important to know first

  • If you’ve already made your first regular payment since the end of your payment holiday, you can’t apply for an extension
  • You’ll be able to apply for a maximum of 3 months’ extension to your payment holiday, after which you won’t be able to take another
  • Extending your payment holiday will mean that interest will continue to accrue and be added to your loan balance, further increasing your future monthly payments and the total cost of borrowing
  • Although taking a payment holiday extension will not worsen the status on your credit file, please bear in mind that lenders may take into account other information when making future lending decisions
  • Following revised guidance issued by the Financial Conduct Authority, payment holidays are now referred to as ‘payment deferrals’, so you may see this phrase used elsewhere

See the likely impact of extending your payment holiday

If you’d like to see the likely change to your monthly payments and future total cost of borrowing by extending your payment holiday by up to 3 months, enter your revised payment details from your end of payment holiday letter into our calculator.

Next steps

Keep in mind, you can only apply to extend your payment holiday if you’ve received your letter from us explaining your end of payment holiday options.

Once you’ve used our calculator to see the likely impact of a payment holiday extension and would like to apply, you can apply online.

If you're unable to view the calculator, or have any questions about extending your payment holiday, please call us.

Making payments during your payment holiday

If you're able to afford payments of any amount during an extension to your payment holiday, we strongly encourage you to make these as the impact on the amount of interest accruing on your balance, as well as the amount of your future monthly payments and the total cost of borrowing, would be lessened.

You can pay as little or as much as you like, and whenever suits you. These payments can be made as a single or any number of lump sums, by setting up a regular standing order, or as ad-hoc payments when your finances allow. 

To set up a standing order, or one-off transfer, you'll need some details from your end of payment holiday letter:

  • beneficiary – name(s) on your mortgage account
  • sort code – first 6 digits of the mortgage account number on your letter, this will always begin '40'
  • account number – the following 8 digits of the mortgage account number on your letter
  • reference – choose your own reference, this is how the payment will appear on your mortgage statement

 

If you want to make payments to more than one mortgage account, you'll need to follow the process above for each account.

See more instructions on payment options.

Dealing with financial difficulty

If you’re experiencing enduring financial difficulties and require support for any reason, please fill out an Income and expenditure form to help us understand your current financial position.

How it works

It’s a series of questions about your income and outgoings (such as salary and mortgage payments/rent) to help us assess your circumstances and find a solution to support you.

It should take about 10-15 minutes to complete and once you’ve completed the form we’ll be in touch to provide personalised support.

 

To complete the form, you’ll need to:

  • provide basic information about yourself and your current employment status
  • detail your current monthly income and expenditure information. If you have a joint debt with another HSBC customer, you’ll also have to provide their income and details of any shared household bills
  • be as precise as you can so we get an accurate view of your current financial position

Next steps

If you’re a joint account holder, you’ll also need to complete the partner income section of the form. You only need to complete one form between you – rather than one per named account holder.

 

Fill out the Income and expenditure form

 

Filling the form out won’t impact your credit file. However, depending on your circumstances, some of the solutions we offer may. If this is the case, we’ll let you know.

 

If you would like to call us to discuss this option, please contact us on 0800 085 2482.

 

Lines open:

  • Monday - Friday 08:00 - 18:00
  • Saturday 08:00 - 16:00

Call us

To discuss your options, please call us on 0800 169 6333, select option 0.

Lines open:

  • Monday to Saturday, 08:00 – 20:00
  • Sunday, 09:00 – 18:00

Further support

The Financial Conduct Authority (FCA) has provided guidance you may want to follow.

Try making a list of all the organisations you make payments to. Record how much you pay them and whether you’ve fallen behind on any payments. This includes essential household bills such as electricity and gas. It also includes loans and any other debts or payment obligations you may have.

It's important to understand which of your debts are priority debts. Some debts will be more urgent than others, because the consequences of not paying them can be more serious than for other debts. For example, priority debts may include things like your mortgage and where you’ve made a contractual commitment to pay.

For more on which debts you should pay as a priority, see the Money Advice Service's page on How to prioritise your debts. Once you’ve prioritised your debts, you can work out a budget to understand how much money you’ll have available to pay what you owe. You might like to use a tool such as the Money Advice Service's budget planner.

If you’re worried about being able to make future payments, it’s important to get in touch with the organisations you’re paying and let them know. They may be able to talk to you about options for changing how or when you pay.

To find out more about managing your money during and after the coronavirus pandemic, see the Money Advice Service’s coronavirus support or contact the Money Advice Service for help on 0300 500 5000.

Who can I speak with to get independent advice?

You can also get free independent advice from:

It’s easy to get in touch online. Talk to us directly through our chat channels.