How long after coming off 6month repayment holiday before bank approves loan

Hello All,

Are there any banks allowing refinances/new loans after a 6month holiday?

If yes, which lenders?
If not, what is the minimum period of waiting?

Same job, income increase, more savings, less expenses & no defaults etc?
Purchase will be funded by cash and no equity release required.

An approval was granted before covid but decided not to go ahead....

Thank you in advance!

 

Why would you go on repayment holiday when you obviously had cash to get through these tough times.
The banks were always going to hold it against people regardless of what the media portrayed

 

Hoarding cash I'd imagine

 

I know for a fact that UK banks have come out and said that anybody who applied for a payment holiday has had a black mark attributed to their credit file. Assume this would apply here.

Why anybody would think that a bank would not record a mortgage payment holiday as a distress signal is beyond me.

“I need a 6 month mortgage repayment holiday please, I’m suffering financial hardship”

1 month after mortgage repayment has ended...

“Can I have a massive loan for another property please”

 

except it wont, because apra said so.

 

You’ll likely have to wait until you’ve got 6 months of repayment history before you can refinance to another lender.

Cheers

Jamie

 

In what context ? Link to article ?

This would surely pop up as a BIG red flag during a serviceability check !

Why would anyone apply for a hardship holiday if they had a decent buffer ?

Never try to scam a bank at their own game

 

APRA advises regulatory approach to COVID-19 support | APRA

A repayment holiday is not considered a failure to pay.

 

We took it, the bank didn’t even ask if we were in financial hardship and I didn’t tell them. They obviously said it doesn’t impact credit or otherwise, however now going through statements it shows 3 months of “arrears” which are now stuck on bank statements and won’t be removed.

So whilst it may not technically be deemed as affecting credit score it certainly is a black mark as any other lender outside of them would see it like I haven’t paid the loan for 3 months.

 

So you met the criteria as part of a COVID-19 support package

Otherwise a false statement may have been made !

A false statement for financial gain often results in an investigation and a fraud charge

 

Yep we met the criteria but also had some
Savings in our offset. we chose to not blow our whole savings and use a 3 month holiday (which we will pay a tiny bit more interest short term.

No fraud here, completely within the rules.

I’d say this is one of the most common, one person looses a job or needs that holiday, they are completely within the rules even if they have $200k in savings. Is it technically hardship? No, but falls within the criteria.

 

Couple of grand in principal. Hardly worth it

 

Banks don't want to touch you if they see it on your statements, so you're screwed for a while. They don't care what Apra says

 

This is true. in our case with 5 loans it was worth it, managed to place the funds in the share market and generate a 90% return and we now have another 20% deposit. Worked out well, was all within the rules, and came out of a challenging/stressful time much better off.

Only bugger is we now have to wait 6 months before we could buy again, which is ok given the Melb market.

 

You rid it well!

 

Good stuff. I also took out a pause on one of my P&I IP loans since the bank was offering it no questions asked and they stated in the online FAQ that it would not impact credit rating. I kept just paying interest and put the surplus in the offset to build up buffers just in case. I wish I'd had the balls to put it in the market instead...

 

A repayment holiday isn't going to appear on your credit file, but your existing bank does know about it and they will remember it forever. I wouldn't even think about asking your existing lender for more credit at least until the pandemic is declared over. That will likely be well after a vaccine is deployed.

Other lenders aren't going to be very comfortable with people on repayment deferrals. There's plenty that are accepting Jobkeeper, but repayment deferrals are another thing entirely. It says that you couldn't afford your commitments even with government assistance. Best to wait until you've got at least 6 months of clean statements before trying to refinance.

If you took the repayment holiday when you didn't actually need it, I have little sympathy. The banks have to adhere to something called responsible lending, but borrowers also need to practice 'responsible borrowing'.

 

Punting $1,000s in to Sports betting also doesn't affect your credit rating. Still, not looked upon favorably by banks

I imagine the repayment holiday is the same

My partner and I received 20% pay cuts but still paid the minimum repayments with no holiday because of exactly this. We'll be looking to upgrade in 12 months and didn't want it going against us. That and even with the 20% cut the repayments were still pretty comfortable

 

No false statement made.....

2 days were cut earlier in the process but have since gone back to work....

Tennants vacated in Victoria and Agent couldn't advertise due to restrictions....changed agents & now fully tennanted....

Had $$ in offset......but wanted to be safe just in case.....bank fully approved deferral

More savings from not paying 2Xchildcare & staying at home/ lifestyle since March etc.......
Also considered 2nd casual job for the 1st time due to uncertainity.....

Hence the above situation....No fraud

 

It wouldn't be hard to work out if someone had a payment holiday, regardless of credit file.