Bank of Ireland COVID-19 mortgage supports

Frequently Asked Questions

 
  • 1. How do I apply for a mortgage payment break?

    Initial COVID-19 payment breaks are no longer available. The Closing date for applying for your first COVID-19 payment break was 30 September 2020.

    To ask to extend your payment break from 3 months to 6 months, complete the application form online at boi.com/paymentbreak, text “mortgage” to 50365 and we’ll send you a link, or call our Customer Relationship Team on 01 611 3333 (lines open 9am to 5:30pm, Monday to Friday).

  • 2. Can I apply to extend the term (duration) of my mortgage?

    Yes. If you have had a 3 month payment break applied to your mortgage loan and wish to apply to extend your mortgage term by 3 months, or if you’ve had a 6 month payment break and you wish to apply to extend your mortgage term by 6 months, you can do so by completing the Call Back form on our website at boi.com/paymentbreak. One of our agents will go through the detail with you over the phone and give you all the information you need.

    This option may be suitable for you if you normally pay full capital and interest repayments and you want to keep your regular repayments closer to the level they were before your COVID-19 payment break.

    IMPORTANT NOTES ABOUT EXTENDING YOUR MORTGAGE TERM:

    If you extend the term of your mortgage loan, while your repayments will be closer to the level they were before your COVID-19 payment break, it’s important to understand the implications of this – our agents will be able to explain this to you over the phone – i.e.

    • You will end up paying more in interest over the life of your loan;
    • The new end date of your mortgage loan may not align with your planned retirement date;

    • There could be implications for your life cover and you may need to review it with your life policy provider.

  • 3. Am I eligible for an extended (6 month) payment break on my mortgage?

    Payment breaks are available to holders of both Private Dwelling Home and Buy-to-Let mortgages who meet the following criteria. However, if you don’t meet these criteria, we may still be able to help you – complete the online application form and one of our agents will call you to discuss your application.

    Payment Break criteria

    • This is a precautionary1 request (your income hasn’t reduced but you want a safety net) OR it reflects a temporary reduction in your income which has occurred as a result of the current health crisis;
    • You were not concerned about your ability to meet your repayments prior to COVID-19;
    • You are not in a forbearance arrangement with Bank of Ireland or, if you are, you have met all the terms and conditions for a minimum of 12 months;
    • You were not in arrears prior to March 2020 on any mortgage account or other Bank of Ireland loan.
    • Your mortgage loan was approved or drawn down prior to 17 March 2020
    • 1. Your balance will be higher at the end of the payment break, your subsequent repayments will increase and you will pay more interest, so you should only apply for a payment break if you are satisfied you need one.

      Applications are subject to approval. Qualifying criteria and terms and conditions apply

  • 4. Will taking a payment break mean I end up paying more interest?

    Yes. You are not required to make capital or interest repayments during a payment break but interest continues to be applied to the loan during it. This means the amount you owe will be higher after the payment break. And because the maturity date doesn’t change (unless you and we have agreed otherwise), your repayments after the payment break will be higher in order to repay the mortgage by the end of its agreed term (the duration of the loan).

    Under question 5, you can see some worked examples showing the implications of a payment break. You can also use the payment break calculator at boi.com/paymentbreak to get an indication of what this will mean for your mortgage loan.

    If you feel confident you can afford to make some partial or full mortgage repayments during the payment break period, you should strongly consider doing this. Paying down your loan as soon as you can will reduce the amount of interest you will pay over the life of your mortgage, while options such as extending your payment break or extending the term of your loan will cost you more in interest. Call us on 01 611 3333 to discuss this.

  • 5. What impact will a payment break have on my mortgage balance?

    Here are some worked examples based on a mortgage with €100,000 owing, on a rate of 3.0%, and remaining terms between 10 and 30 years.

    Term remaining before maturity 10 Years 15 Years 20 Years 25 Years 30 Years
    Amount owing on the mortgage loan €100,000 €100,000 €100,000 €100,000 €100,000
    Interest rate 3% 3% 3% 3% 3%
    Current monthly repayments at this rate €965 €690 €554 €474 €421
    Total amount to repay with no payment break €115,832 €124,240 €133,014 €142,147 €151,632
    Monthly repayments after a 3 month payment break €994 €705 €564 €481 €427
    Increase in monthly repayments after a 3 month break €29 €15 €9 €7 €5
    Total amount to repay with a 3 month payment break €116,286 €124,739 €133,561 €142,744 €152,284
    Additional interest cost of a 3 month payment break €455 €499 €547 €598 €651
    Monthly repayments after a 6 month payment break €1,024 €720 €573 €488 €432
    Increase in monthly repayments after a 6 month break €59 €30 €19 €14 €11
    Total amount to repay with a 6 month payment break €116,743 €125,240 €134,109 €143,344 €152,937
    Additional interest cost of a 6 month payment break €911 €1,000 €1,096 €1,197 €1,304

    These are illustrative examples based on a sample rate of 3%. The calculations assume the interest rate will not change for the rest of the mortgage term. (At the end of a fixed rate period customers can choose from rate options available then or roll to the variable rate that will apply at that time. Variable rates can change during the life of a mortgage.) Monthly repayments are based on full capital and interest payments.

    A payment break means there will be no direct debit payments from your current account to your mortgage for the period of the break, while we will continue to apply interest to your mortgage during the payment break. The mortgage balance will have increased over the payment break, meaning your monthly instalment at the end of the break will be higher.

    In the 20-year example above:

    3 month payment break

    • After a 3 month payment break, the monthly instalment required to pay off the mortgage over the remaining 20 years is €564 which is €9 a month higher than without the payment break (the slight difference is due to rounding to the nearest euro).
    • When the entire 20-year mortgage term is considered, after a 3 month payment break the total amount repayable, originally €133,014, will increase by €547 to €133,561.

    6 month payment break

    • After a 6 month payment break, the monthly instalment required to pay off the mortgage over the remaining 20 years would be €573 which is €19 a month higher than without the payment break.
    • When the entire 20-year mortgage term is considered, after a 6 month payment break the total amount repayable, originally €133,014, will increase by €1,096 to €134,109.
  • 6. What are the key points to consider when thinking about an extended mortgage payment break?
    • Your mortgage loan will not go into arrears as a result of availing of an extended Payment Break.
    • The balance will be higher at the end of the payment break period than it was at the start of the payment break.
    • Your subsequent repayments will increase and you will pay more interest so you should only apply for an extended payment break when you are satisfied you need it.
    • The term (duration) of your mortgage will not lengthen as a result; it will have the same maturity date it had before the payment break unless you choose to extend your loan term (see question 2 for more information on this).
    • If you feel confident you can afford to make some partial or full mortgage repayments during the extended payment break period, you should strongly consider doing this. Paying down your loan as soon as you can will reduce the amount of interest you will pay over the life of your mortgage. Call us on 01 6113333 to discuss this.
    • If you have any doubts about taking a payment break, we strongly recommend you get independent legal or financial advice.
    • If you feel you might have longer term difficulty in meeting your mortgage repayments, we're here to help. More information including where you can get independent support with managing your debt is available here
    • If you were in arrears prior to taking the COVID 19 payment break, this arrears will continue to be owed until paid.
  • 7. What are the key things to consider in choosing to extend my mortgage loan term (duration)?
    • If you choose to extend the term of your mortgage loan, the maturity date of your mortgage loan will be pushed out by the duration of your term extension. This means, for example, if choose to extend your term by 3 months your mortgage will mature 3 months after its original end date.
    • An extension to your mortgage term may cause a misalignment with your planned retirement date. If you extend your mortgage term it could also have implications for your life cover. You should check with your life insurance provider to ensure your level of cover is sufficient to cover the full term of your mortgage.
    • If you choose to extend the term of your mortgage loan, your repayments will be lower as the amount you owe will be spread out over a longer period. But because the term of our loan will be longer, you will pay more interest – i.e. your cost of credit will be higher than it would be without a term extension.
    • If you can afford to make additional repayments (i.e. ‘overpayments’) at any stage during your remaining term you should strongly consider doing this. Paying down your loan when you can will reduce the amount of interest you will pay over the life of your mortgage and may also reduce your term. Click here for more information on Overpayments.
  • 8. Will my mortgage rate change as a result of applying for a payment break?

    No, your mortgage rate will not change as a result of taking a payment break.

  • 9. Will I be told when the extended (6 month) payment break has been applied to my mortgage?

    Yes. We will send you an SMS to confirm when your payment break request has been processed.

    Once the extended payment break has been implemented, we will send you a confirmation letter with full details including implications for your mortgage contract.

  • 10. Will a COVID-19 payment break affect my record on the Central Credit Register?

    There will be no adverse impact on the credit records in the Central Credit Register or the Irish Credit Bureau of customers who avail of a payment break as a result of being financially impacted by COVID-19.

  • 11. What happens to my mortgage during a payment break?

    During a payment break your repayments for that period will be zero (i.e. you will not have to repay any capital nor pay any interest). But while you don’t have to make payments during the payment break, it is important to note that interest will still be applied to your mortgage.

    Your ‘break’ repayments and accumulated interest will be added to the amount owed and your repayments will be adjusted going forward so that your mortgage will be repaid within its agreed term. This means that your repayments will be higher than they were before the payment break and you will pay more in interest over the life of your mortgage, i.e. the cost of credit on your loan will be greater than it would be without the payment break.

    Towards the end of your payment break you will be offered the option to extend the term (duration) of your mortgage to return your repayments closer to where they were before your payment break. However, extending the term of your mortgage will result in a higher cost of credit. See question 2 for more information on this.

    If you feel confident you can afford to make some partial or full mortgage repayments during the payment break period, you should strongly consider doing this. Paying down your loan as soon as you can will reduce the amount of interest you will pay over the life of your mortgage, while options such as extending your payment break or extending the term of your loan will cost you more in interest. Call us on 01 6113333 to discuss this.

  • 12. What happens at the end of a 3 month or extended (6 month) mortgage payment break?

    Before the end of your 3 month or extended (6 month) payment break we will write to you with information about the options available to you then and how to avail of them. Click here for details about these options.

  • 13. Is a COVID-19 payment break included in the maximum three payment breaks allowed over the life of a mortgage?

    Under our normal flexi-options a customer can take up to 3 payment breaks over the life of the mortgage and COVID-19 payment breaks are not counted as part of this.

    To be eligible for a payment break under our standard Flexi-Options:

    • your mortgage loan must be fully drawn down at least 2 years,
    • there must be at least 12 months between payment breaks,
    • 6 months must have lapsed since your COVID-19 payment break if you took one
    • and you must have complied with all the terms and conditions of the mortgage.

    Applications are subject to approval. Available on your principal private dwelling only. Only available on annuity (standard capital and interest) repayment mortgages. Interest is applied during the break and the amount owed is higher at the end of the payment break which means you pay more interest over the life of the loan.

  • 14. Does a payment break affect my TRS payments?

    Yes. If you are eligible to receive Tax Relief at Source (TRS), your TRS is calculated based on the amount of interest paid. Therefore, for months where no interest is paid on the mortgage loan, there will be no related TRS payments. As TRS payments operate one month behind, you should see the TRS impact in the subsequent month. For example, if you don’t make mortgage repayments for the three months of April, May and June, you will not receive TRS payments in May, June and July.

  • 15. Is there additional support or independent advice available if I feel I might have longer term difficulty repaying my mortgage?

    It is important to note that if the impacts to your financial circumstances could be longer lasting, a COVID-19 payment break may not be suitable for you. Please contact us at the earliest possible stage if you are concerned that you may experience longer term financial pressure and would like to explore additional supports to help you repay your mortgage loan. We are here to discuss this with you.

    We will need you to complete a Standard Financial Statement (SFS) as a first step in this process. The SFS is a standard form set out by the Central Bank of Ireland designed to let you give us an accurate picture of your financial circumstances. In addition to helping us find the best solution for you, it ensures that we meet our duty to give you the full benefit of the legal protections that apply to you.

    If you avail of other supports with us to help you manage your mortgage repayments, we will treat this assistance as forbearance (i.e. a special arrangement) and it will be recorded under your credit records with the Central Credit Register and the Irish Credit Bureau. More information including where you can get independent support with managing your debt is available here

  • 16. Is there a cooling off period if I change my mind about availing of a payment break?

    By way of a ‘cooling off period’, you have control over your repayments during your payment break and there is no cost to you for making repayments to your mortgage loan while you are on a payment break. Even if you are on a fixed interest rate, you can make a payment during the payment break period of your current repayment amount plus 10% without cost.

    Paying down your loan where you can afford to do so will reduce the amount of interest you will pay over the life of your mortgage, while options such as payment breaks or extending the term (duration) of your loan will cost you more in interest.

  • 17. Since level 5 has been applied across the country for 6 weeks from 21 October, are the banks reintroducing COVID-19 mortgage payment breaks?

    Banks, including Bank of Ireland, are following the industry guidance in relation to providing assistance to mortgage customers who may be experiencing difficulty with their mortgage repayments due to the additional measures introduced by the Irish Government to contain the spread of COVID-19. If you feel you may have difficulty with your mortgage repayments we encourage you to contact us as soon as possible and we will explore options to help you manage your repayments depending on your circumstances.

    Should you require additional support, please complete the form here and one of our customer service agents will be in touch with you.

  • 18. If I took one COVID-19 payment break and returned to making repayments for a time, can I still apply for the second COVID-19 payment break now?

    Under guidance from the European Banking Authority and the Central Bank of Ireland, customers who availed of a COVID-19 payment break had the option to extend their payment break for an additional 3 months should they need it. However, the option of another COVID-19 payment break is not available.

    If you experience difficulty with your mortgage repayments due to the additional measures introduced by the Irish Government to contain the spread of COVID-19 we encourage you to contact us and we will explore options to help you manage your mortgage repayments depending on your circumstances.

    Should you require additional support, please complete the form here and one of our customer service agents will be in touch with you.

  • 19. If I availed of an extended COVID-19 payment break (6 months total) can I apply for another 3 months (9 months) total?

    While we are aware that some customers may be experiencing additional financial difficulty due to the new restrictions introduced by the Government on 21 October, a further extension to the COVID-19 payment break is not available.

    However, should you require additional support due to the new COVID-19 restrictions, please complete the form here and one of our customer service agents will be in touch and we will explore options to help you manage your repayments depending on your circumstances.

  • 20. What are the options for me now if I experience difficulty with my mortgage repayments due to COVID-19?

    We have a range of supports available to help customers who may experience further financial difficulty due to the COVID-19 national health emergency. The first step is to realise that we are here to help. The earlier we know about any concern you may have, the sooner we can work together to identify the best solution to get you back in control of your finances. Our customer service agents are fully qualified and can review your circumstances with you with a view to identifying options that will suit yours needs. Complete the form here and one of our customer service agents will be in touch with you.

    If you have already fallen into arrears, call our dedicated line on 07662 44444 (open 9am to 6pm Monday to Friday).



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