Repayment / Interest Only Mortgages
Mortgage lenders agree a loan over a selected term to enable an individual to purchase a property. During the term of a mortgage, you as the borrower agree to pay a rate of interest on the full amount borrowed and agree to repay the capital borrowed by the end of the specific period of time.
As security against the loan, the mortgage lender usually takes a charge on the property being bought. This means the property cannot be sold unless the outstanding loan amount is repaid. It also means the property may be repossessed if you do not keep up repayments on your mortgage. The loan amount is usually a percentage of the value of the property being purchased, which is assessed by the lender’s surveyor.
Once you have decided on whether you want to opt for a Capital Repayment Mortgage or an Interest Only Mortgage, you need to turn your mind to interest rate options. We have outlined below the main interest rate options available to you