Your line of credit options
As part of our credit relief program, you may have also opted to increase your credit line by 10%. During the deferral period, the full amount of your line of credit, including the increase was covered by insurance.
As your six-month deferral period comes to an end, so will the increased insurance coverage on your line of credit. This means that you may have a portion of your line of credit that is not covered by your monthly insurance premium. Once this period is over, you have three options:
Reverse the increase and return to your original line of credit amount.
Speak with a lending specialist to discuss options to repay the increase to your line of credit or expand the insurance to cover the additional credit.
Keep your insurance at the original amount and leave the increase uninsured.
Resuming mortgage and loan payments
At the end of the deferral period, your payments will resume on the same payment schedule and for the same amount as your original payment plan, with no action required. In addition, if you choose to repay part or all of your deferred payments, here are your options:
- Until December 31, 2020, you can make extra payments on deferred principal and interest, over and above our 20% pre-payment privileges.
- After December 31, 2020, you have the option to make extra payments on your mortgage using our pre-payment privileges.
- This means each year, you can pay an additional 20% of your original mortgage value with no penalty or additional fees.
Frequently Asked Questions (FAQ)
Click on a question below to be taken directly to the answer.
What if I'm ready to resume payments early?
If you are ready to resume payments, please give us a call at 1.800.728.6440 and we can assist you.
Will my mortgage payment amounts change to cover the deferred payments?
At the end of the deferral period, your payments will resume on the same frequency, and for the same amount as your payments prior to the deferral period. At the end of the six-month period, accrued interest will be added to the principal of your mortgage.
For conventional mortgages, your mortgage term will be extended by six months. For CMHC-insured mortgages, the term will not be extended. In this case, your payment amount will increase to ensure the mortgage will be paid off within the original amortization.
When I renew my mortgage, will I need to pay the interest up front?
No, you will not be required to pay the deferred interest up front when you renew your mortgage. The interest accrued during your deferral period will be added to the principal of your mortgage one payment period prior to the end of the deferral period.
For CMHC-insured mortgages, your payment amount will increase to ensure the mortgage will be paid off within the original amortization.
Why can’t you simply forgive the interest accrued during the deferral period?
We’ve always worked with members who needed our help, and this time has been no different. Our goal with the credit relief program is to help our members protect their cash flow during a time of hardship.
As a credit union, our members are all part-owners of SCU. They have entrusted us to serve as stewards of their money, which means we work in best interest of all of our members – those who need to borrow money and those who are growing their savings. If we forgave the interest on loans and mortgages, it could have an effect our ability to provide high interest rates on deposits. This in turn could have an impact on our members’ financial futures.
It’s also important to note that as a credit union, our profits go back into the communities we serve, in the form of jobs, high interest savings rates, and new borrowing opportunities for consumer and business members.