Most
high-street lenders offer Interest-only
mortgages.
Some will want to see proof that you have a suitable plan
in place for repaying the capital sum at the end of the mortgage
term this is known as a repayment
vehicle.
However, they are not required to ask and the majority will
take your word for it.
Many lenders also offer part and part mortgages,
where part of the mortgage is interest-only and the rest is
repayment.
Most
lenders will allow you to switch from an interest-only to
a repayment basis during your mortgage term.
This is an increasingly popular option with first-time buyers,
who need to keep costs down in the early years.
But don't be tempted to wait too long to make the change,
as interest-only mortgages are actually more expensive than
the repayment variety over the long term.
• An endowment
policy. This is a stock market based investment policy
designed to mature just as the mortgage ends, providing a
payout to clear the outstanding capital debt.
Well, that was the theory anyway. The reality has proved to
be rather different
As anyone who has an endowment mortgage will tell you, most
of them have not done anything like as well as was hoped.
Poor investment returns mean many endowment
holders are facing serious shortfalls.
Nowadays, you can use any kind of investment an Isa (individual
savings account), a pension, other property etc as a vehicle
for repaying your capital debt.
However, there are risks with all of these and it's essential
to discuss them fully with an independent financial adviser
before committing yourself.
Read
enough? Just want a quote? To get
your best mortgage quote quickly and easily we can
put you in contact with a recommended mortgage adviser. It's free,
completely confidential and there's no obligation at all. Simply
fill out the form below
