What is an Interest Only Mortgage?
With an interest-only mortgage, you only pay the interest charges on your loan. You don’t pay back any of the original capital borrowed within your monthly mortgage payment. This means your monthly payments will be lower than on a capital and interest mortgage, but at the end of the term you will still owe the original amount you borrowed from the lender. You will need to have a suitable repayment strategy in place to clear the mortgage in full at the end of the term.