We understand that customers may experience short term repayment difficulties with their Term Loans as a result of COVID-19. Find out all you need to know about a Term Loan Payment Break during COVID-19 through our dedicated FAQ. 

Term Loan Payment Break FAQ

What is a COVID-19 Term Loan Payment Break?

A COVID-19 Term Loan Payment Break is a temporary arrangement specifically set up for customers financially impacted by the COVID-19 crisis. The final date customers could submit an application for a COVID-19 Payment Break was Wednesday 30 September 2020, and no further applications can be accepted. We understand that you might continue to experience repayment difficulties either as a result of COVID-19 or for other reasons. Please contact one of our Customer Service Agents on 1800 855 010 or 021 601 3700 to chat through your options and how we can help and support you. Our lines are open from Monday to Friday, 8.45am until 6pm (excluding public holidays).  

How do I apply for a COVID-19 Term Loan Payment Break?

Applications for new COVID-19 Term Loan Payment Breaks closed on the 30 September 2020. This date was set by the European Banking Authority (EBA) for all lenders to process and grant Payment Breaks.

If you are experiencing payment difficulties on your Term Loan due to COVID-19 or other circumstances please speak to one of our Customer Service Agents on 1800 855 010 or 021 601 3700  Our lines are open from Monday to Friday, 8.45am until 6pm (excluding public holidays).

Will a COVID-19 Term Loan Payment Break impact my credit history (e.g. Central Credit Register /Irish Credit Bureau record)?

No, this will not impact your credit history. If you are availing of an agreed COVID-19 Term Loan Payment Break, your Term Loan will continue to be reported to the Central Credit Register / Irish Credit Bureau as if it were operating in line with your existing Term Loan arrangements.

What happens at the end of the COVID-19 Term Loan Payment Break?

At the end of the COVID-19 Term Loan Payment Break, your regular Term Loan repayments will automatically resume. Your repayments will be recalculated and will increase to take account of the Payment Break and allow you to pay the outstanding Term Loan balance over the remaining term of the loan.

*Please Note: Where your repayment frequency is weekly or fortnightly, the original expiry date of your Term Loan will be extended by up to one month (The original expiry date is the date when your loan was due to close if your request for this COVID-19 Payment Break had not been accepted). On expiry of the Payment Break, your regular repayments will be adjusted as a result of the Payment Break which means that your Term Loan repayments will increase.

We will write to you before the end of the Payment Break to inform you of the options available to you following the end of your COVID-19 Payment Break, the three options are:

Option 1: Return to the arrangements that applied before your Payment Break, with your repayment adjusted accordingly;

Option 2: Extend your Payment Break for a further period, up to three additional months, subject to a maximum of six months in total;

Option 3: Contact our Customer Service Agents to explore other potential arrangements. This includes the option to extend the term of the Term Loan by the length of your Payment Break.

 

If at the end of the Payment Break you are unable to return to your new monthly repayment amount, you will need to contact our Customer Service Team to discuss the options available to you.  

We will provide full contact details and information in the letter issued.

Will the interest rate on my Term Loan change as a result of taking a COVID-19 Payment Break?

The interest rate on your Term Loan will not change as a result of the COVID-19 Payment Break.

What impact will a COVID-19 Payment Break have on my Term Loan?

The Covid-19 Payment Break will have the following impact on your Term Loan:

  • The overall cost of your Term Loan will be higher. This means that you will pay more interest over the remaining period of the loan, (See Appendix for a representative cost of credit illustration);
  • Your Term Loan repayments will increase when you re-commence repayments; and
  • The additional interest may be collected after the expiry of the Term Loan.

The table below provides examples of the how the COVID-19 Term Loan Payment Break will result in an increase in repayment amounts at the end of the Payment Break and increase the overall Cost of Credit to you. The examples below are based on a typical Term Loan where no repayments are made for a period of three months. 

The exact cost for your Term Loan will depend on a number of factors including, the outstanding balance, remaining term and the interest rate.

Appendix: Representative Cost of Credit illustration

Term Remaining 2 Years  5 Years 10 Years
Term Loan Balance €10,000.00 €10,000.00 €10,000.00
Current Interest Rate (fixed 3 years) 10.00% 10.00%  10.00% 
Current Monthly Repayment €461.45 €212.47 €132.15 
       
Monthly Repayment Amount (post payment break) €534.21 €226.69 €137.52 
Difference in Monthly Repayment Amount €72.76 €14.22 €5.37 
       
Balance in 3 months (with no payment break) €8,856.17 €9,609.35 €9,852.32 
Revised Balance in 3 months (post payment break) €10,252.55 €10,252.55  €10,252.55 
Difference in Balance €1,396.38 €643.20  €400.23
       
Total Amount Repayable (current) €11,074.80 €12,748.20  €15,858.00
New Amount Repayable €11,218.41 €12,921.33 €16,089.84
Difference in Amount Repayable €143.61 €173.13 €231.84

This table is for illustrative purposes only.

What impact will a COVID-19 Term Extension have on my Term Loan?

Where you are coming off a COVID-19 payment break and choose to extend your term under the COVID-19 Term Extension, we will provide a Term Extension offer to you which is to be signed and submitted to us within 30 days for the Term Extension to be put in place. Once received, we will confirm acceptance of the Term Extension with a confirmation letter.

The Term Extension cannot be greater than the length of your Payment Break.

Reporting to the Central Credit Register and Irish Credit Bureau will not be impacted by this COVID-19 Term Extension.

This means that your Term Loan will continue to report in line with your new loan arrangements; however we will not report the Term Extension.

Coming off COVID-19 Mortgage Payment break

To help you understand your options and to answer as many of your questions as possible, BPFI has produced a guide to coming off the COVID-19 Mortgage Payment Break

Log in to Open24

Our contact centre is very busy helping customers who are worried about the impact of COVID-19. Don’t forget, you can continue to carry out your day-to-day banking through Open24.ie

Cocooning during COVID-19

As an industry, we’ve come together to create a guide to help our customers manage their money while cocooning during this challenging time.

Back to top
Page loading
Alternate Text