Interest-Only Mortgages

In recent years, it has become much more difficult for borrowers to access interest-only mortgages. But with the right expertise, it’s still possible to secure high value interest-only finance – so if you’re looking for an interest-only mortgage, Articus Finance can assist.

Our brokers have many years’ experience sourcing large interest-only mortgages, enabling us to source you the best deal for your circumstances – whether that’s a high loan to value (LTV) or a low interest-only mortgage rate. We work with high street, specialist and private banks, meaning we leave no stone unturned on the hunt to find you an interest-only mortgage.

What is an interest-only mortgage?

With an interest-only mortgage, your monthly repayments will consist only of the interest on your borrowing, and not the capital. Accordingly, your monthly repayments will typically be smaller than a capital repayment mortgage – as you won’t be paying down the loan. Instead, you will pay back the full amount at the end of your mortgage term.

Typically, interest-only mortgage terms are much shorter; you could expect a term of between five and seven years. At the end of this term, you will need to either repay the loan in full or refinance onto a capital repayment mortgage.

What are the benefits of an interest-only mortgage?

An interest-only mortgage is an ideal option for many high net worth (HNW) borrowers, and for those looking to maintain their liquidity during the life of a loan.

If you have a clear repayment strategy in place for the end of the mortgage term, an interest-only mortgage could help to minimise your monthly payments, giving you lifestyle flexibility or more freedom for other investments.

Why should you use a broker to arrange an interest-only mortgage?

Before the 2008 financial crisis, interest-only mortgages were widely available. Over ten years on, there is a much smaller pool of lenders willing to offer interest-only finance, which means arranging an interest-only mortgage can be challenging.

Even once you’ve found a lender, there are further hurdles to overcome. For example, most lenders will limit the loan-to-value (LTV) available on an interest-only mortgage, with many only prepared to lend you up to 50% of the property’s value. Typically, this means you’ll need a large deposit, or plenty of equity in your property if you’re remortgaging.

The assistance of an experienced broker is invaluable here, not least because some banks only offer interest-only mortgages through intermediaries. A broker can negotiate on your behalf, meaning you could access the best interest-only mortgage deals available from a range of private or investment banks.

We can also help with complex cases, like interest-only mortgages for retired borrowers, or interest-only mortgages for foreign nationals.

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Proven Expertise

Our specialist mortgage brokers are highly experienced in negotiating the best mortgages and mortgage rates, no matter how complex your situation.

With over 20 years’ combined experience sourcing the best mortgage deals for global clients, our brokers have the skills, knowledge, and lender relationships to turn your property aspirations into a reality. To find out how we do it, explore our case studies.

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