The retail banks, non-bank mortgage lenders and credit servicing firms (so called “vulture funds”) have announced measures to help customers navigate these tough and unchartered times. These measures include postponing court proceedings for three months and the option of a payment break for up to three months. A payment break can offer a lifeline to those who need it; however, it is important to understand what it means for you and what happens to your loan when repayments resume.

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• What is a payment break?
• Why put a payment break in place?
• What type of payment breaks are available?
• What does a payment break look like?
• If I’m in mortgage arrears, can I get a payment break?
• I'm in a PIA or DSA and I need to access a payment break, what should I do?
• I'm in an alternative repayment arrangement (ARA) and I need to access a payment break. What should I do?
• I’m not in arrears, should I apply for a payment break?
• Will a payment break affect my credit rating?
• Are there any supports to help me deal with my lender?
• Are there other supports available for those already in mortgage arrears??
• How do I apply for a payment break?

It is a freeze on payments for up to three months, followed by ongoing reviews depending on the scale of your individual situation.

A payment break frees up your financial resources, meaning you can focus on essentials for your family such as food and utilities. This can help to remove some of the stress and anxiety you may be experiencing. If you are experiencing these feelings, the HSE have created a useful guide titled "Minding your mental health during the Coronavirus outbreak".

Moratorium Payment Break: This means full loan repayments stop for an agreed period. Once this moratorium period has finished, future loan repayments on the mortgage will increase. This happens because the loan must be repaid in its full during the agreed term.

Interest Only Payment: This means only interest is paid on the loan during the agreed period. Your monthly repayments will be less during this period, however, because you are not paying any capital (the amount you borrowed), your loan balance will not reduce during this period.

Each application is reviewed on a case by case basis but, lenders are committed to supporting all borrowers during COVID-19, even those already in financial distress. Contact your lender directly. If you can't speak with your lender, then contact MABS where a dedicated adviser will be able to assist.

You should contact your Personal Insolvency Pratitiioner (PIP) without delay if you think you will not be able to make your personal insolvency arrangement (PIA) or debt settlement arrangement (DSA) repayments.

If you have an alternative repayment arrangement (ARA) that you've negotiated on your own, then contact your lender directly. If the ARA was negotiated with the help of MABS, then contact your adviser. If you are unsure, then we advice that you contact an anviser from MABS.

You should only apply for a payment break if you are out of work and are likely to fall into mortgage arrears. If you can survive financially and can continue making repayments as normal, it is recommended you do so. This prevents the unnecessary build up of larger future repayments. If you are concerned about your future financial stability, then we recommend that you speak with an specialist adviser from MABS. Money advisers from MABS are expert at reviewing your financial situation and will provide independent, confidential and non-judgmental advice.

Deferred payments are usually spread over the term of your loan but will result in an increase to the cost of credit on your loan. This means that when your repayments start again they will be for a higher amount as your lender will add the deferred payments to your overall loan balance and keep the term the same. Your lender will agree repayment terms with you on a case-by-case basis.

If you agree to a payment break with your lender under a COVID-19 application, your credit history will not be affected.

On March 30th, the Central Bank of Ireland (CBoI) has confirmed that there will be no impact on a consumer’s credit rating if they take part in the mortgage repayments breaks. Information on measures introduced by the main banks and credit servicing funds, or so-called “vulture-funds” was announced by the Banking and Payments Federation of Ireland (BPFI) on the 19th March 2020.

The full CBoI update is available here.

Yes – if you are unsure about your situation and next steps to take, it is always worth talking to someone about it. Contact your local MABS office to speak with an experienced adviser. If you struggle to engage with your lender, MABS can contact them on your behalf, taking some stress away from the situation.

Yes – borrowers can get free financial and legal advice through Abhaile. It is a Government funded scheme that provides support to people in long-term mortgage arrears. MABS is the gateway to Abhaile and working with the Insolvency Service of Ireland (ISI) and the Legal Aid Board (LAB), the scheme provides a wide range of help. To date, it has helped thousands of borrowers in mortgage arrears keep their home.

The following lenders have introduced online applications for borrowers seeking a payment break:

• AIB
• Bank of Ireland
• Ulster Bank

To request a payment break with following lenders and loan owners, you must contact them directly:

• Permanent TSB
• KBC
• Dilosk/ICS Mortgages
• Finance Ireland
• Mars Capital
• Pepper
• Start Mortgages

This FAQ blog does not represent legal advice and is intended for guidance only. If you are concerned about your current or future personal financial situation then please contact a money adviser from MABS. All face-to-face consultations are currently suspended, however advisers are available by phone and email. Contact details are available here.

Source: BPFI Press Release 25th March 2020 - COVID-19 Crisis - Banking and Payments Industry Support>. (opens in a separate window)

MABS is open and money advisers are available to take your money advice queries by phone and email. You can contact your local MABS office or call the MABS Helpline on 0761 07 2000, Monday to Friday, from 9am to 8pm or you can check the MABS website for further updates and guidance.