With the impact of Coronavirus being felt across the country, our aim is to ensure your peace of mind when it comes to your money.
We know that many people may be worried about their finances at this time. Together we are working with the Government to make sure that we are giving you the support you need with your mortgage payments.
We are all working hard to maintain the best service we can for you. As you can imagine our telephone lines are exceptionally busy at the moment. This means that those who need us most right now - those who are most financially vulnerable – are struggling to get through. Due to these high levels of demand and staff having to work from home we are asking for your help too.
You should speak with us in good time before your next payment is due.
Before calling:
• Ask yourself: Do I need to talk to Saffron today?
• Can I ask this question by email? If you can, then contact us at mortgage.collections@saffronbs.co.uk
Payment Deferrals
If you are worried about meeting your mortgage payments, we can offer a variety of solutions, including payment deferral (also known as ‘payment holidays’).
If you can afford to make your mortgage payments, it is in your interests to do so.
A payment deferral means you agree with us that you will not have to make mortgage payments for a set amount of time. Whilst your mortgage contract with us does not feature payment deferrals as an option, we understand that the coronavirus situation will have created difficult financial situations for many of our members, which is why we are offering the option of a payment deferral for up to three months for additional support in these exceptional circumstances.
We will need to talk to you to understand how your finances have been impacted by the coronavirus, to assess your circumstances and consider all options which might be better suited to your needs and in your best interest.
It is important to remember that the payment deferral is a temporary break from your mortgage payments to help you through this period of uncertainty. You still owe the amounts that you don’t pay as a result of the payment deferral; interest will continue to be charged on the amount you owe. The amount of interest you pay over the term of the mortgage will increase.
To help you decide whether a payment deferral is right for you, we will let you know the estimated impact on your mortgage account of a full payment deferral for three months by telling you:
• The estimated interest that will accrue
• The estimated increase in the mortgage balance
• The estimated new mortgage payment based on the increased balance and shorter term remaining to repay it
• The estimated increase in the total amount you will pay over your remaining term
If you are able to make part of your normal mortgage payment to reduce the money you owe then you should do so.
You should not apply for a mortgage payment deferral if you are not experiencing or do not reasonably expect to experience payment difficulties, as a deferral is not in your best interests.
How will the missed payments be repaid?
If you are currently up-to-date with your mortgage payments, at the end of the payment deferral we will recalculate your monthly payment based on your outstanding balance and remaining term. We will do this automatically unless you tell us this is not what you want to do (opt-out) and you would like to discuss possible other ways to repay the unpaid instalments.
If you decide to add the unpaid instalments to your existing balance, your payments will increase and the amount of interest you pay over the term of the mortgage will increase – we will tell you the exact amounts before the end of the payment deferral period. If you choose this option and you think you are going to struggle with the new payments, then let us know and we can discuss other options with you at that time.
We want to ensure that payments are affordable for you, so if you currently have arrears on your mortgage, we will contact you before the end of the payment deferral period to agree on how to repay this money. In order to do this we will need to assess your individual circumstances, including your income and expenditure and arrange a specific agreement to pay.
What evidence do I need to provide
We will need to speak with you to understand your individual circumstances and how your income has been affected by the Coronavirus.
Buy to Let Mortgages
We can consider a payment deferral if your tenant has been affected. The payment deferral is intended to support your tenant whilst their finances are impacted by the Coronavirus and you are expected to pass on this relief on to your tenant to ensure they are supported during this time.
What to do about Direct Debits
It is only a payment deferral if it has been agreed with us. You should not cancel your direct debit without agreeing a payment deferral with us first. Leaving your direct debit in place will make it easier to restart your payments at the end of the deferral period. Cancelling your direct debit is not a payment deferral and will be counted as a missed payment.
If you had cancelled your direct debit, you will need to set up another one. You can do this by completing and sending us a new Direct Debit mandate.
Your credit file
Taking a mortgage payment deferral will not have a negative impact on your credit file. However, there are other ways lenders can tell whether you have taken a mortgage payment deferral, which could impact future lending decisions.
Lenders may take into account other information when making lending decisions, including information provided by you or bank account information, for example.
How to Apply
Please telephone 0800 072 1100 and select the option for the Arrears team.
Product Switches
If your account hasn’t been in arrears prior to or after the payment deferral and you meet our usual criteria, we can arrange a product switch for you.
Repossessions
We have temporarily stopped repossession actions. However, interest will continue to be charged and this means that you are likely to get less back if and in the event of your property being repossessed and then sold by us.
If property prices go down between now and the time your property is sold, then you might get even less back, or nothing if your property is sold for less than you owe.
Other sources of information
You can find more help to manage money and debt from the following sources:
Money Advice Service
Online tools to work out a budget: https://www.moneyadviceservice.org.uk/en/tools/budget-planner
Money Navigator
https://www.moneyadviceservice.org.uk/en/tools/money-navigator-tool
Impartial information on payment deferrals
www.moneyadviceservice.org.uk/en/articles/mortgage-payment-holidays
Online guides on how to prioritise your debts
www.moneyadviceservice.org.uk/en/articles/how-to-prioritise-your-debts
Financial Conduct Authority