Thank you for your enquiry for a Interest Only Mortgage
Each person has unique and individual circumstances and requirements, and our recommendation for your Interest Only Mortgage will reflect your own personal needs.
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An interest only mortgage is an option some people choose to purchase their homes. As the name suggests only the interest portion of the monthly loan is paid back on a monthly basis. The capital (or main) part of the loan is paid back in a time agreed upon between lender and buyer. We can help you find the lowest interest only mortgages.
The idea behind this concept is that the buyer will do one of two things. He may choose to have a steady savings account which he has from other revenue making property or business endeavour, and pay the capital in full when the mortgage comes due. He may also choose an interest only mortgage if he is waiting for the price of the home or property to go up and then sell it. This way he will have both the loan’s capital in full and also a profit. He may then use this money to take out a regular fixed or flexible mortgage on a piece of property.
In theory the interest only mortgage is good money making idea. However, certain problems may arrive if the price of the property value fails to increase, or the business that is mortgaged at an interest free rate fails to make enough money to cover the capital investment. There is also the chance that people don’t get around to saving the capital amount due on the mortgage. If this happens it is possible that the lender will repossess the property and the person will have paid all of that money in interest in vain.
As of late more first time home buyers have taken to investing in interest free mortgages. Taking into consideration the high cost of houses; this is the only way some people can afford to own a property. If separate arrangements are not made to pay off the loan in full at a later date, the property may be lost.
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The Mortgage train is a trading style of SourceIFA Limited. Registered office Argyll House, 158 Richmond Park Road, Bournemouth, Dorset. BH8 8TW Registered in England and Wales No. 06363148. This website is produced for information only and does not constitute or offer advice.