Norman Dog

iTrader: (1)

http://www.msn.com/en-gb/money/homea...U&ocid=U453DHP

Wonder if they're going to be the next PPI?

Torquemada

I had one - worst idea ever.

Fortunately I made a good chunk of money when I sold the place. Invested wisely.

stilover

Just depends. In London, they are probably a good idea, as the value of the house will be much higher than what you paid. So as long as you intend to sell and move in the future, I don't see the problem.


For the rest of the country, I can see them being more of a problem. But they can be goods for some still.


I have an interest only offset mortgage which works for me very well.
£90k mortgage amount, but with saving in the offset account, and low interest rate, my monthly payments are £88.50 (down from £137 over the last 5 years)

I'm paying £2500 into my offset account every year to boost the pot, meaning by the time the mortgage term is due to end, I should have less than £10,000 to pay off in one lump sum (or I could just add slightly more each year).

Overall, I'll have saved thousands compared taking out a standard repayment mortgage.

EddScott

It's been mooted as the next PPI "Scandal" although this time, I suspect most folk were more than aware that if they didn't have some kind of investment vehicle to pay off the capital, they'd be screwed.

I know of a few older people who have interest only mortgages and no means to pay the capital who have gone to the lender and said we can't pay but we'll keep paying what we pay now - or something along those lines and not one has been kicked out. Too much hassle for the lender IMO.

I have one BTL mortgage which is interest only but I've kept it as it's 0.99% above base for life.

I've just remortgaged another BTL and gone interest only again because the rate at which I'd pay the capital off through the monthly payments is less than the return I can get on investments so I put the difference in there.

Interest only is fine as long as you have the discipline to keep up the investment vehicle.