What Capitalisation means to you and your mortgage

  • Capitalisation means that your payment deferrals will be added to your overall mortgage balance and you will be given a new contractual monthly payment amount which allows you to repay your payment deferrals over the remaining term of your loan.
  • Your payment deferral balance will be set to zero, meaning as long as no further payments are missed, there is no further impact on your credit file, no monthly administration fees (related to your payment deferrals) and no further legal action taken on your account.
  •  Paying your payment deferrals back over the term of your loan will mean you pay more in interest, compared to clearing your payment deferrals over a shorter period of time. This means Capitalisation may be a more expensive option overall.

Before making any adjustments to your mortgage, temporary or permanent, it is strongly recommended you seek independent financial advice. The Citizens Advice Bureau will be able to provide you with this advice free of charge.