In this episode, we are joined by Peter Norris from Lateral Partners to discuss the Mortgage Holiday Scheme that is currently available as part of the economic response to the Coronavirus.
Property owners need to remember that the mortgage holiday is not really a holiday at all, but rather a deferral. The payments will still need to be made, but you make them at a later date. Remember too that any delayed interest payments will incur additional interest. i.e. you will be paying interest on top of the interest.
If you are to take a mortgage holiday, there are two primary ways you can pay it off.
First, you could keep your loan term the same, and increase your payments. Or, you could keep your repayments the same and extend your loan term.
On a 6-month deferral of a $500,000 loan at 4% interest, the additional repayments required would be $52 a month. Or if you were to keep your repayments the same and extend your alone term, you would need to keep up repayments for an additional 11 months.
We also discuss the Coronavirus webinar, which is happening on the 7th April 2020. We will open up our analysis of 165,000 different data points to show the areas of New Zealand that are most likely to have the deepest downturns and the speediest recoveries in the property market. If you are reading this after the 7th of April, the webinar recording will be available on the Opes Partners website.
