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An interest only mortgage is where your monthly payments only cover the interest charged on the amount you borrow and you don't pay off any of the loan amount. In order to pay off the loan amount at the end of the term, you will need to have an acceptable repayment strategy.
Customers who are new to Yorkshire Building Society and looking to take out a mortgage on interest only must meet the following:
There are a number of acceptable repayment strategies that can be used to support an interest only mortgage. Please see the table below for further details.
|Acceptable Repayment Strategy||Policy Rules|
|Sale of Mortgage Property at the end of term||
If you want to apply for an interest only mortgage, you will need to speak with one of our mortgage advisors in branch or by telephone (see below).
Use your savings to offset against the balance of your mortgage and reduce the interest you pay.
Mortgages that follow the Bank of England Base Rate - you could save money while the Base Rate remains low but your payments could also go up.
Fix your mortgage interest rate, so it won’t change over a set period of time, regardless of what is happening to interest rates elsewhere.
Why not try our mortgage calculators to get an idea of how much you could borrow for your mortgage and what the repayments would be.
Speak to one of our friendly mortgage advisers about your options