Finance Matters

Coronavirus: Payment Holiday Guide

What you need to know about Payment Holidays

We are grateful for the support our members are providing the nation during these uncertain times and want to reassure you that we are here to help you, when you need us most.

We are currently experiencing a high volume of requests from members asking for a payment holiday on their loan repayment. Although this option is available, we want to ensure members are fully aware of the long-term impact this may have on their finances, and that they are fully informed before they make their decision.

Payment Holidays: What you need to know?

Pros

A payment holiday on your loan can help relieve some pressure for a while and free up some short-term funds.
If you are only facing a short term, temporary drop in income, this may be a suitable solution.

Cons

Even though you are not repaying your loan, you will still accumulate interest during the repayment holiday period.
The interest accumulated during a loan repayment holiday will be applied to your total loan balance, making your final outstanding loan balance higher overall.
If a payment holiday is available, and you decide to use it, your credit score may be impacted and in turn so may be your ability to get future credit.

Alternative options are available

We recommend members to contact our team to discuss their options and find a solution that is right for them, based on their individual needs. If you are experiencing financial difficulties as a result of coronavirus, please email a summary of your circumstances and how they have changed to loans@serveandprotectcu.co.uk.

If you have savings with Serve and Protect CU, you can use it to make your loan repayments, and to prevent any potential long-term impact on your credit rating.

The information provided in this article is for guidance and educational purposes only. Police Credit Union Ltd. does not offer regulated financial advice. Please seek independent financial advice.

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Serve and Protect CU is a trading name of Police Credit Union Limited, Guardians House, 2111 Coventry Road, Sheldon, Birmingham, B26 3EA. We are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority & Prudential Regulation Authority under registration number 213306.

Police Credit Union Ltd. is a member of the Financial Services Compensation Scheme. This means a members savings are covered by the FSCS depositor guarantee scheme up to the value of £85,000. Under the Distance Marketing Directive, you have the right to cancel your savings account within 14 days of opening without financial or other penalty.

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