High earning or equity-rich homeowners are unaware they can get low rates and flexible terms on interest-only mortgages despite banks changing criteria to make the deals more attractive, say brokers.
Mortgage brokers Trinity Financial and Private Finance say a common misconception among borrowers is that interest-only is a pre-credit crisis mortgage option.
Aaron Strutt, product and communications director, Trinity Financial, told Mortgage Solutions managazine: “Interest-only mortgages are popular with our clients and they are much more widely available than they were a couple of years ago. Yet a lot of borrowers still do not realise that lenders are offering these mortgages again.
“Interest-only isn’t suitable for everyone but they useful at the moment. The vast majority of borrowers take full capital repayment mortgages, while part interest and part capital repayment deals are more suitable for many homeowners who want to lower their monthly repayments.”