Coronavirus and your financial holidays …


Coronavirus has created unprecedented and far-reaching financial uncertainty for countless UAE households.

Many people have been furloughed while, sadly, others have been made redundant, lost freelance or contract work and even forced to close their own businesses.

If you’ve suddenly lost your income, you should first find out if you qualify for any state benefits (as well as statutory sick pay if you are self-isolating). But help is also available if you are struggling to pay your household bills. We’ve rounded up the latest – but bear in mind it’s an ever-evolving situation, so we’ll be updating this page when things change.


What help is available for mortgage holders?


Do I need to prove I have been impacted by coronavirus?

Many lenders are offering fast-track approval, so you may not be asked to provide evidence of your situation or undergo means testing.

However, you will still need to answer all questions truthfully and should only apply for a mortgage payment holiday if you are struggling as a direct result of coronavirus.

When will I have to repay the deferred payments?

How you eventually repay what you owe from your mortgage holiday varies between lender. However, it’s most likely to do one of the following:

  • Spread the cost of the shortfall across the remaining term of your mortgage (resulting in bigger monthly payments once the holiday has ended)
  • Increase the length of your mortgage term (but keep payments the same)

Will taking a mortgage holiday affect my credit score?

Provided you have a formal agreement in place to take the payment holiday and you meet your repayment obligations once it has come an end, it will not affect your credit score.

Credit Cards

What help can I get with credit card repayments?

Many credit card providers were already offering forbearance (‘flexibility’) to customers with short-term cash flow issues – such as increasing credit limits and waiving fees for missed payments, while a handful are offering payment holidays tailored to individual circumstances.

Will I still be charged interest?

Credit card providers will still be permitted to charge a ‘reasonable’ rate of interest over a payment holiday. Bear in mind this interest will build up over time and work out more costly in the long-term.

APRs (annual percentage rates), particularly on store and credit cards, are expensive so only take the payment holiday if you really need to.

If you can’t make the minimum repayments and can afford to do so, consider paying a smaller sum instead.

Will my credit score be affected?

As with mortgage payment holidays, an agreed payment holiday on your credit card, store card or catalogue will not negatively impact your credit rating. However, if forbearance is exercised beyond three months and you enter into a debt repayment plan, this may no longer be the case.

Personal Loans

What help can I get with loan repayments?

Many loan providers are already offering payment holidays, while others are allowing reduced payments or waiving fees for late payments – so get in touch and see what yours is offering.

The deferred debt would be repaid by either spreading the cost of the shortfall across the remaining term of your loan (resulting in larger monthly payments) or increasing the length of your loan term (but keep payments the same).

Again, interest will accrue during your loan payment holiday, so only take it if you really need to.

Agreed payment breaks will not affect your credit score.


Credit Scores

How will the current situation affect my credit score?

So long as any payment holiday, payment reduction or any other forbearance has been agreed, your credit score will not be affected.

However, if you cancel a direct debit, stop making payments or do not have adequate funds to cover it your payment without an official agreement, standard rules apply and your score could be negatively impacted.

This is also likely to be the case if you’ve come to the end of an agreed spell of forbearance but then require longer-term help such as a debt repayment plan.

Keep the following guidance in mind when it comes to protecting your credit score.

  • Always try to make at least your minimum monthly repayments
  • Avoid taking out any further lines of credit if you can
  • Make sure any payment holiday has been officially agreed with your lender
  • Stay in touch with your lender if you are still struggling


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