Ways to repay your mortgage
Find out more about the type of mortgage you have with us:
Other things to consider:
A repayment mortgage ensures that both the original loan (the capital) and the cost of borrowing the money (the interest) are fully repaid by the end of the mortgage term, provided you make your monthly repayments.
In the early years, most of your payments cover interest charges, but as your outstanding loan gradually decreases over time, more of your monthly payments repay the actual loan.
An interest-only mortgage offers you the ability to borrow the money you need and pay a monthly amount to cover the cost of borrowing (the interest). At the end of the mortgage, you'll need to repay the full amount of the original loan (the capital).
To do this you'll need to have separate savings or investments in place – such as an endowment, ISA or pension – that will mature at the same time as your mortgage loan.
Please note that it's your responsibility to make appropriate arrangements to repay the capital of your loan. We suggest that you talk to an Independent Financial Adviser (IFA) to find the best option. You must have a suitable repayment vehicle in place.
Part repayment, part interest-only mortgage
A part repayment and part interest-only mortgage simply offers you a combination of the first two options – giving you the flexibility to manage your loan and its repayment in a way that suits your budget.
The repayment element of the mortgage will be repaid at the end of the mortgage term. The interest only part just pays the interest, so you'll need to have suitable arrangements in place to repay the remaining capital amount.
Repaying your mortgage early
You may find yourself in the fortunate position of being able to repay your mortgage early. This could be due to overpayments made on your mortgage or a lump sum repayment. Either way it's best to check your options with us before repaying your mortgage, to find out whether early repayment charges apply. If you want to repay your mortgage in full, you'll need a redemption statement from us which sets out how much you'll need to repay, including any fees or charges.
Whichever way you choose to repay your mortgage, we recommend that you consider having sufficient life cover in place to cover the total amount of your mortgage, including associated fees, just in case the unthinkable should happen.