Interest Only Mortgage Information

Information on mortgages on an interest only basis

The most important thing to remember about an interest only mortgage is that you are only paying the interest on the loan and not the capital. This means that at the end of the mortgage term you will have to have another means of paying back the mortgage loan.

You can pay back the loan by a variety of means, including:

Using your pension

With an ISA

Through Investments

By Switching to a repayment mortgage

In addition, it is worth noting that you can be making money from your property through house price rises in the area. You should have some sort of plan in place for paying off the balance though, and the most common solution is to move on to a repayment mortgage.

Interest only mortgages and remortgages are an excellent option if you want to keep you payments down and expect finances to improve in the future.

An example of how powerful this tool can be illustrates why this option has become popular:

On a L250,000 mortgage at 6.000% for 30 years-

Principal and Interest payment= L1498.88

Interest Only mortgage payment at 6%= L1250.00

Total Monthly savings= L248.88

Get specific information through the headings below: