Mortgage repayment options

Unless you buy outright, a new property will involve taking on a home mortgage. How you decide to pay off that initial loan or capital has an ongoing impact on your monthly outgoings, as well as your longer term potential to make that property your own. Our mortgage advisors can help you find the home mortgage that suits you, your financial goals and your income.

The main choices you have to make are

• Repayment or interest only?
• How long is the repayment term?

Repayment

Providing you make the necessary payments on time, a repayment mortgage guarantees you’ll clear your debt by the end of the agreed term. Part of each month’s payment goes to paying off the capital, and part goes to paying interest on the loan.

Interest only

An interest only mortgage involves paying off the interest and making simultaneous payments into a savings plan. At the end of the mortgage term you use the savings to pay off the full amount of the capital in one go, however, the savings plan is not guaranteed to pay off the loan.  You will have to make up any shortfall.

Repayment term

Most home mortgages have a standard repayment term of 25 years. To minimise the total interest charged the shortest term possible will always be recommended.   You may prefer a term of 25 years or more if minimising monthly payments is more important to you than the overall cost of the loan.

We don't charge for our advice. Instead we simply charge a fee for arranging your mortgage. A typical fee is £399. We will never charge more than 1.5% of the value of the mortgage.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Find your local mortgage advisor to discuss mortgage rates.