Echo Finance

INTEREST ONLY MORTGAGES

With repayment mortgages you pay off the interest and some of the capital each month, guaranteeing that the mortgage will be cleared at the end of the term.

With interest-only mortgages, you only pay off the interest on the amount you borrow.

You use savings, investments or other assets you have (known as ‘repayment vehicles’) to pay off the total amount borrowed at the end of your mortgage term.

Example

If you have a £100,000 interest-only mortgage for 25 years, you’ll pay the interest on the amount you borrowed each month.

When the 25 years are up, you’ll have to pay the full £100,000.

You must be able to show the lender how you’ll repay the mortgage at the end of the term.

You - not the lender - are responsible for putting in place and maintaining a credible repayment plan to repay the original loan.

You can’t rely on the promise of a future windfall such as an inheritance or bonus.

You also can’t speculate that property prices will rise enough to allow you to buy a smaller home and still pay off the mortgage.

The lender will check at least once during your mortgage term that your repayment plan is on track to cover your mortgage.

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THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
IF YOU ARE THINKING OF CONSOLIDATING EXISTING BORROWING YOU SHOULD BE AWARE THAT YOU MAY BE EXTENDING THE TERMS OF THE DEBT AND INCREASING THE TOTAL AMOUNT YOU REPAY.
Echo Finance

Registered in England and Wales No. 6939070. Registered office - The 1812 Building, Wheatley Park, Mirfield, West Yorkshire, WF14 8HE. Echo Finance Limited is authorised and regulated by the Financial Conduct Authority. Echo Finance Limited is entered on the FCA register (www.fca.org.uk) under reference 570073. The Guidance and/or advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK. The Financial Conduct Authority does not regulate Will Writing, Estate Planning and some forms of Mortgages. © Copyright Echo Finance Limited. Where you have a complaint or dispute with us and we are unable to resolve this to your satisfaction then we are obliged to offer you the Financial Ombudsman Service to help resolve this. Please see the following link for further details: www.financial-ombudsman.org.uk.

Echo Finance Limited

The 1812 Building, Wheatley Park, Mirfield, West Yorkshire, WF14 8HE

Local Rate: 01484213337
Freephone: 08000934914
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