Interest Only Mortgage
Interest Only Mortgages
Interest Only
As their name suggests, with an interest only mortgage you only repay the interest on the loan. At the end of the term the capital is still outstanding. Therefore you will need some way to repay this capital. Usually some form of investment policy is taken out to save up enough to repay the loan at the end of the term.
Mortgage Advice in Gloucester
Traditionally the preferred product for repaying the capital of an interest only mortgage was a mortgage endowment policy (which included a set amount of life cover) - although more recently customers are using Individual Savings Accounts (ISAs) and pensions to build up a sufficient sum and taking advantage of the tax breaks offered by these products.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
The Financial Services Authority does not regulate some forms of mortgages.