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Mortgages Explained >
Interest only |
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This is one of those mortgages that does exactly what is says on
the tin. It is Interest only, this means all you pay the
mortgage company is the interest due each month on the debt for
the period of time that you have the mortgage loan for.
However at the end of this term you have to repay the debt on
full.
Due to the fact that you have only been making an interest only
payment through out the mortgage term the original debt in full
will still be outstanding.
When you arrange a mortgage on this basis it is paramount that
you ensure you have a suitable repayment vehicle or repayment
plan in place so that you are not unable to repay the mortgage
when the lender is ready for it to be redeemed.
In the section marked "repayment
vehicles" you will be able to read what sort of repayment
plans can be put in place that will assist in paying off the
loan by the end of the term.
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