Mortgage Repayment OptionsMortgage repayment options need to be considered in order to choose how the method of mortgage repayment will be satisfied. The two main mortgage repayment options are broken down into the options of mortgage repayment through a capital and interest mortgage, sometime called a repayment mortgage and the other option of an interest only mortgage. These two mortgage repayment options should only be decided after a full appraisal of your attitudes to risk in order to ensure that whichever mortgage repayment options are taken, they are in fact the most affordable and suitable mortgage solution to meet your needs. In considering the two main mortgage repayment options, we start by asking the ultimate question and that is, do you require the guarantee that at the end of the term your mortgage will be fully paid off should you make all payments in full and on time. If the answer is yes then the only mortgage repayment option for you is the capital and interest only mortgage as this is the only mortgage repayment option which will provide a guarantee that at the end of the term the mortgage will be fully repaid. In the event that when looking at the mortgage repayment options you can confirm that you are happy that the capital outstanding will be repaid from other sources, be that inheritance, sale of the property, overpayments or some form of investment vehicle be it a pension or an ISA, then an the interest only mortgage repayment option may be most suitable for you Sifting through the pros and cons of the mortgage repayment options is extremely important and as ever, there are numerous choices and decisions to be made that should take into account your personal circumstances, needs and attitude to risk. Repayment Mortgages This means that each monthly payment that you make to the Lender will contain an element of capital in addition to the interest payable on the loan. The proportion of each will change throughout the period of the loan. The proportion of capital repaid increases with each monthly payment. As long as all repayments due to the lender are made in full and on time the mortgage will be repaid. Interest Only Mortgages As the name suggests, you will only pay the interest each month. The actual amount borrowed does not reduce during the term of the mortgage and the full amount of the loan will remain outstanding to be repaid at the end of the term. It is vital that you ensure that you have the means to repay the loan at the end of the term. You are responsible for ensuring that any investment vehicle is maintained for the duration of the mortgage and should note the consequences of failing to maintain such investment vehicles. If you wish to take out a mortgage with no repayment vehicle, intending to sell your property at the end of the term to repay your mortgage debt, you must be aware that house prices fluctuate and the value of your property could fall, which may mean that the total amount outstanding at the end of the term could be more than the amount originally borrowed. In this case you would be liable for the repayment of the balance outstanding at that time Repayment Option Advice Why not speak to one of our Mortgage Advisers for advice on mortgage features by calling 0845 3 630 430 or Enquire Online. | 
