Mortgage repayments

Dj_Jestar · 31 Jan 2011 at 13:36

Fair dos.

rG-tom · 31 Jan 2011 at 13:36

Dj_Jestar said:
Er, hold the press.. the point and purpose of an Interest only mortgage, is that you only pay the interest. If you pay more than this, you are paying off the capital - thus not interest only.

this does mean though you're only legally obliged to pay interest, so the month that the boiler explodes you dont have to worry about paying the full repayment amount, but the month you get your bonus you can pay loads off. This means you can pay off as much as you want/can afford to without the risk of being short 1 month, and generally without any penalties

Dj_Jestar · 31 Jan 2011 at 13:42

Yeah, I understand now, but I was under the impression that if you pay off early the bank throw a hissyfit, thus my belief that banks don't allow capital repayment on an I/O mortgage (and that they are aimed at people on short-term holdings.)

HungryHippos · 31 Jan 2011 at 13:54

I've booked an appointment with my local HSBC branch for 08/02 so should be able to speak to them about it then, discuss my options and such

Jez · 31 Jan 2011 at 14:24

Dj_Jestar said:
Yeah, I understand now, but I was under the impression that if you pay off early the bank throw a hissyfit, thus my belief that banks don't allow capital repayment on an I/O mortgage (and that they are aimed at people on short-term holdings.)

Some might i guess, but i would be surprised if almost all I/O options are not totally flexible.

Ev0 · 31 Jan 2011 at 15:36

Dj_Jestar said:
Yeah, I understand now, but I was under the impression that if you pay off early the bank throw a hissyfit, thus my belief that banks don't allow capital repayment on an I/O mortgage (and that they are aimed at people on short-term holdings.)

Nope you can 'overpay' on an IO to cover come capital if you like. Only restrictions I normally see are like if you're currently on a deal then it can be capped to say no more than 10% of your outstanding balance a year.