Many people are experiencing financial uncertainty as a result of the COVID-19 pandemic.

Some are working in a reduced capacity from home, others have had to close their businesses for a time, and some will unfortunately be losing their jobs altogether.  In this time of financial hardship, one of the major stresses for home owners is how to keep paying their mortgages.

As a first step, anyone who is facing financial hardship and/or job loss should disclose this to their bank openly and honestly.  Everyone is affected by the COVID-19 situation, so it will come as no surprise to your bank if you let them know the position you are in.  Being upfront with your bank means that you can work with them to make a plan. 

The Government has announced a “mortgage repayment holiday scheme”.  Under the scheme New Zealand’s retail banks will defer repayment for all residential mortgages for up to six months where customers are financially affected by COVID-19.  This means that affected customers will not make principal and interest payment on their loans for up to six months.  It is important to note that interest will still accrue, so deferred interest will be added to the principal amount of the loan.  In other words, you will still have to pay that money to the bank at the end of the six months.

Talk with your own bank to find out more about the financial assistance they are offering to customers affected by COVID-19, and how a mortgage repayment holiday might work for you.