Interest Only Mortgage Warning
Do You Have an Interest Only Mortgage?
An Interest Only Mortgage means that that your monthly mortgage repayments only ever cover the interest element of a mortgage. The debt itself is not being repaid so that at the end of the mortgage term, if you borrowed £50,000, you still owe £50,000.
The Financial Conduct Authority (FCA) have estimated that there are over 1 million households in the UK with an Interest Only Mortgage and many of these have no means of paying this off when the mortgage comes to an end.
Mortgages are set up for a specific number of years and when they come to an end the mortgage lender will look into your circumstances (your age, income, credit rating etc) before lending money again. This can mean that it can be difficult to borrow the money again and some people may face having to sell their home in a hurry or face eviction.
Do not ignore any letters that you get from your lender. Even if your mortgage is not due to come to an end for a few years, it is essential that you have a plan of action. The longer you leave it, the more limited the options are.
Lyn Financial Services have a team of experienced Mortgage Advisers that can look at your particular circumstances. They will discuss all your options from putting all or part of the mortgage onto a repayment mortgage, using savings, an Equity Release mortgage or downsizing your house.
Phone on 0800 018 1315 to arrange an appointment.