When you apply for a loan in an institution, we are verified in terms of our ability to repay the debt on a given date. Appropriate income-supported documents are required, which will allow us to estimate how much credit the bank can offer.
In addition, the credit history in economic databases and the Polish Bank Association are also analyzed, as each bank wants to be sure that the borrower is in fact a reliable client. When we go through the creditworthiness test procedure, we get a preliminary positive or negative response on the financial commitment.
However, we are interested only in the first option. The customer received a loan because his ability to pay the debt made it possible. However, the loan period there may be various difficulties, such as dismissal or sudden accident, which may result in loss of financial liquidity. Then the borrower may temporarily fail to repay the installments, which is referred to as credit holidays.
Credit holidays – what is it?
Credit holidays are temporary suspension of installments repayment due to financial liabilities. It can be a period of one month or several years. Some banks offer one-off credit holidays, while others have to offer several postponements to debt repayment.
In addition, you can suspend the entire loan installment, which consists of both the costs of its service and capital or only the amount of capital itself. Of course, all repayment terms remain unchanged. Such temporary deferral of the liability return has no impact on the client’s credit history.
It is a contract between him and a given bank, which is not recorded in any of the economic offices. The bank also determines from what moment credit consumers will be entitled. They are usually available after half a year of regular debt repayment. Sometimes we meet a grace period that has to do with the suspension of loan repayment. This is the time that has elapsed since the conclusion of the contract with the bank until the first installment.
Credit holidays should only serve us when our financial situation deteriorates. This is not the time to realize your whims, because we will not avoid repayment of the loan.