Repayment

How does it work?

You borrow a lump sum over a fixed period of time (usually 25 years but can be shorter or longer). You pay the interest and some of the capital on a monthly basis to the lender.

ADVANTAGES:

1. Some flexibility with repayments.
2. The only way you can be 100% certain the loan will be repaid, providing repayments are maintained.

DISADVANTAGES:

1. Monthly mortgage payments may be higher than interest only mortgages covered by an investment/life assurance product to repay the capital.
2. Only a small amount of capital is paid off in the early years as the monthly mortgage payment consists of a higher proportion of interest to capital repayment.

Your home may be repossessed if you do not keep up repayments on your mortgage.

We can be paid by commission from the lender or a fee of 0.75% of the loan amount (e.g. for a loan of £100,000 the fee would be £750). We will refund to you any commission we receive from the mortgage lender. You will receive a Key Facts illustration which will tell you about any fees relating to a particular mortgage.