Using mortgage holiday / reduced payment to maximise tracker payment bonus

[Billy Baltic]

There has been a lot of speculation that holders of trackers will be offered deals for early payment once they have been transferred off the books of the banks.
I have a tracker with a few years left to pay and would like to take advantage of any possible deal if it materialises.
I was wondering if it would be possible to take a payment holiday now with a view to maximising the balance remaining when a deal comes along.
Did previous mortgage holidays stop people taking advantage of the previous PTSB bonus?
Would a holiday affect future credit rating?

 

[aido71]

Forgive me if I have taken you up wrong but the tone and wording of your post suggests that you have a cheap tracker that you can afford ( no indication that you are struggling with repayments) but you just want to avoid paying so that at some stage in the future you can maximise the amount of the loan( you voluntarily took out ) that you can write off completely??!!!
Payment breaks/holidays are there to give people a breather not to help with avoidance of paying what they owe. If you are in difficulty then that is a different issue (and i apologise accordingly)but if not then it just sums up our society who do not want to take personal responsibility for their own choices.
If I sound preachy then just cos am fed up with everyone blaming everyone else for their problems. There's lots of blame to go around... At least some must be taken by people themselves.

 

[serotoninsid]

Would a holiday affect future credit rating?

There have been a couple of threads on this recently - run a search (from memory, I think it did matter).

Did previous mortgage holidays stop people taking advantage of the previous PTSB bonus?

I doubt very much this would come into the equation.

I was wondering if it would be possible to take a payment holiday now with a view to maximising the balance remaining when a deal comes along.

I guess you could do that - but will it really make that much of a difference? Open to correction but most payment holidays are 3 months, no? - with 12 months being the maximum.

your post suggests that you have a cheap tracker that you can afford ( no indication that you are struggling with repayments) but you just want to avoid paying

That's not my understanding of the OP's post. From what I understand, he/she wants to maximise any benefit that could be coming from a potential deal on tracker mortgages. They are not saying they are not going to repay the mortgage in full. Any 'deal' on tracker mortgages would not be a write-off in the sense of a non-performing loan - it would be a deal on a product that the banks offered despite the fact that it's a lossmaker for them.

 

[44brendan]

Being in the banking business, I see no prospect of any general "deals" being done to entice people off tracker mortgages. Bank's exiting the market (eg BoSI) would be the exception.
If you have a legitimate rationale to request a payment "holiday" you will need to apply under the MARP requirements. This will not directly affect your credit rating. However if your financial circumstances are such, that you can meet your mortgage payments, the Bank in question may refuse your request.

 

[Brendan Burgess]

Forgive me if I have taken you up wrong ...

but you just want to avoid paying so that at some stage in the future you can maximise the amount of the loan( you voluntarily took out ) that you can write off completely??!!!

Payment breaks/holidays are there to give people a breather not to help with avoidance of paying what they owe.

Hi Aido

I assume that the OP is referring to a PTSB mortgage where there is a right to take two payment holidays of 3 months. If so, taking them with a view to using the proceeds to take advantage of a subsequent discount is perfectly valid.

 

[aido71]

I absolutely accept the validity of taking advantage Of the payment holidays. I certainly meant no offence but I guess I feel empathy with those on SVR who are bearing brunt of everything and in genuine difficulty with, at present, no sign of any way forward. ( I am on SVR but not neg equity and relatively low balances outstanding so have no issue either way as my interest payments are low anyway so have no 'axes' to grind.)I know banks want rid of trackers but I guess I wonder if this is going to happen to the cost of others when rates rise as they must do at some stage. My understanding of payment holidays is not complete as I don't have that option but I generally understood that it was to assisist in potential periods of financial difficulty to allow some breathing space.

 

[serotoninsid]

I know banks want rid of trackers but I guess I wonder if this is going to happen to the cost of others when rates rise as they must do at some stage.

If the finger needs to point anywhere on this - it's back at the banks - your own bank - and others. You can't blame ordinary people for trying to maximise a situation to their advantage. Remember, it was the banks that were pushing these products. I switched from one tracker to an even better tracker during the tiger - as another bank were offering an even more attractive deal. WHY they offered such deals (given that it's believed their feasibility from the banks point of view is a mut point) is something I'd love to hear the bankers answer...

 

[Billy Baltic]

Hi Aido

I assume that the OP is referring to a PTSB mortgage where there is a right to take two payment holidays of 3 months. If so, taking them with a view to using the proceeds to take advantage of a subsequent discount is perfectly valid.

Yes, it is a PTSB mortgage and yes, that was my intent. Thanks Brendan.

 

[Billy Baltic]

There have been a couple of threads on this recently - run a search (from memory, I think it did matter).
I doubt very much this would come into the equation.
I guess you could do that - but will it really make that much of a difference? Open to correction but most payment holidays are 3 months, no? - with 12 months being the maximum.
That's not my understanding of the OP's post. From what I understand, he/she wants to maximise any benefit that could be coming from a potential deal on tracker mortgages. They are not saying they are not going to repay the mortgage in full. Any 'deal' on tracker mortgages would not be a write-off in the sense of a non-performing loan - it would be a deal on a product that the banks offered despite the fact that it's a lossmaker for them.

I think it could make a difference. If I could take a mortgage holiday of 3 months and a discount of 20% is applied to trackers before the end of my mortgage then I will save 20% of 3 months payments (20% of 3000Euro) = 600 Euro.
Am I missing something?

 

[Billy Baltic]

Forgive me if I have taken you up wrong but the tone and wording of your post suggests that you have a cheap tracker that you can afford ( no indication that you are struggling with repayments) but you just want to avoid paying so that at some stage in the future you can maximise the amount of the loan( you voluntarily took out ) that you can write off completely??!!!
Payment breaks/holidays are there to give people a breather not to help with avoidance of paying what they owe. If you are in difficulty then that is a different issue (and i apologise accordingly)but if not then it just sums up our society who do not want to take personal responsibility for their own choices.
If I sound preachy then just cos am fed up with everyone blaming everyone else for their problems. There's lots of blame to go around... At least some must be taken by people themselves.

I have every intention of paying my mortgage but if there is an opportunity not to throw money away needlessly then I'll take that!