• >
  • Guides>
  • Can I get a debt holiday?

Can I get a debt holiday?

As the coronavirus crisis forces more people into a difficult financial position, you may be finding it tough to meet debt repayments. A debt holiday could be a solution.

Share this guide

As things change rapidly during the coronavirus (COVID-19) crisis, this guide will be updated regularly to reflect changes in rules and regulations.

What is a debt holiday?

Taking a debt repayment holiday means that instead of making your monthly repayment, you will pay nothing for an agreed period. 

The payments are instead deferred to a later date, so it is important to remember you will still owe the money and interest will continue to accrue until you have paid it off.

What help is available?

Credit Cards

Taking a payment holiday will not affect your credit file so long as you are up to date with your repayments.

If financial problems caused by the coronavirus crisis have left you struggling to meet your credit card payments, you may be eligible for a repayment holiday of up to three months. This also applies to store cards and catalogue debt.

Taking a payment holiday will not affect your creditworthiness and you should not face any additional charges.

Some lenders have also suspended fees and offered to tailor repayment plans to your needs. Get in touch with your lender to find out what help they are providing customers.

Your credit card company may offer to increase your credit limit, but it is important to remember that this would impact your credit file.


If you are in arrears on mortgage or loan repayments, speak to your lender to find out how a payment holiday will impact your credit file.

The UK Government has announced that mortgage lenders will offer a three-month payment holiday in response to the coronavirus outbreak, aimed at customers in financial difficulty.

Remember, you will still owe the money from the payments you have skipped and interest will accrue for the period those payments are unpaid.


If you have an unsecured personal loan, you will be able to go on a payment holiday of up to three months. Contact your lender to find out more about what they are doing to help customers affected by the coronavirus crisis. Taking a payment holiday will not affect your creditworthiness and you should not face any additional charges.

Borrowing more money is unlikely to solve your debt problems.


Overdrafts can be a useful tool to manage your cashflow problems, but it is essential you make sure you have the right one to avoid sky-high interest rates.

New rules regarding overdraft fees went into effect starting from 6 April, as the Financial Conduct Authority (FCA) instructed lenders to simplify charges. Banks must now advertise only an interest rate, without daily fees.

It was intended to make the cost of borrowing through an overdraft easier to understand and compare with other types of lending. But in response many banks raised overdraft interest rates to as much as 40%.

However, after pressure from the FCA given the economic crisis due to COVID-19, banks including Santander, TSB, Bank of Scotland, HSBC, Lloyds and Halifax have moved to temporarily give customers automatic interest-free overdrafts during the coronavirus crisis. These range up to £500 and are designed to help if you are finding it difficult to manage during the pandemic. 

Check your bank is offering this service before you go into an overdraft. Unplanned overdrafts can be expensive and challenging to repay.

The FCA has announced that from 14 April 2020 banks must, upon request, make the first £500 of authorised overdrafts interest free for 3 months.

You should also be aware that these measures are not permanent, so your rate of interest may change again in the future. It is best to find out from your bank when they plan to increase their rates.


If your landlord is able to benefit from a buy-to-let mortgage holiday as a consequence of the coronavirus crisis, you should be entitled to a rent payment holiday. The UK Government have advised that any savings landlords make should be passed on to tenants.

Evictions have also been frozen to protect renters during the pandemic.

If you have been furloughed or on a reduced salary due to the coronavirus crisis, speak to your landlord about what they can do to help manage your rent payments.

What if my debt is unmanageable?

Free help is available if you are worried that your debts are becoming too much. You can get free advice over the phone from Citizens Advice or StepChange Debt Charity, who also offer a free debt management plan.

Find out more about managing your debt here.

About Joel Kempson

View Joel Kempson's full biography here or visit the money.co.uk press centre for our latest news.