What to do When Your Mortgage Holiday Ends

What to do When Your Mortgage Holiday Ends

Property prices across the country are in the midst of a strong growth phase and the overall economy is getting back on track.

However, there are still a number of people who have been impacted by the events of the past 12 months and have needed to take advantage of mortgage holidays. Mortgage holidays and fiscal support are slowly starting to come to an end so the question now turns to what to do with your mortgage with the deferral period finishing.

The first thing to do is talk to your mortgage broker in Melbourne about your options and they will be able to assist you in making the best possible decision.

Here are some options for those people who previously deferred their mortgage.

Go back to Normal Repayments

If you are in a position to do so, it might be wise to go back to making your normal mortgage repayments.

A mortgage holiday is just a deferral, so there was always going to be a time when you needed to start making your repayments again. If your work situation has improved then this might be the best option.

If you’re still not quite back to where you were before, speak to a mortgage broker in Melbourne and they can liaise with your lender.

Push Out Loan Term

If you’re still not back at the same income level as before, there are some options you can consider to help make repayment at a lower level. 

One option is to increase your loan term. You could potentially change a 25-year term to a 30-year term and lower your monthly repayments. It is worth noting that this could very well increase your overall interest costs. It is worth discussing this option with your mortgage broker.

Get Another Deferral

It’s important to remember, that your initial deferral was an arrangement made between you and your lender.

It might be possible to speak to your lender and get a further deferral in your mortgage if required. This is something that will depend on your personal situation and your mortgage broker in Melbourne can help.


If you are in a position where you have income coming in and it is enough to service a loan, then it might be worth considering refinancing.

Over the past 12 months, we’ve seen interest rates fall to record low levels and if you can refinance, you might be able to take advantage of the current offers. This could save you a significant amount of money, but it is important to note that you will need to be able to demonstrate that you can service a new loan.

Similarly, you could take out a new loan and pay interest only. This will help save you money on your repayments and most interest only loans revert to principal and interest after 4-5 years.

Consider Selling

If your income hasn’t recovered and isn’t likely to, it might be worth considering selling your property. Of course, it is worth exploring all options but this is still something you can do.

The property market is currently experiencing a growth phase across the country and selling in the current climate is a good option. You don’t want to get yourself in a situation where you are defaulting on your repayments as that will be detrimental to you long term and make finance harder to obtain in the future.

As always, the first step in the process is speaking to your mortgage broker in Melbourne and discuss your options. Everyone’s situation is different and lenders are prepared to work with you to get the best possible outcome. The key is to engage in the conversation early so you can clearly assess all your options.

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