Help please interest only mortgage

alijolly

I am in a bit of an unusual situation and need some guidance please. My dh has been given a loan note from his company which is payable in April 08. This will be enough to clear our mortgage in full. At present we have two mortgages both with sub-prime lenders and are paying high interest rates. After taking advice we are now applying for an interest only mortgage with a high street lender, with the intention of paying the mortgage off in full next year. Even taking into account the redemption fee we will be paying this will save us £6000 over the next year. The mortgage will only be for between 50-60% of the value of the house.

My difficulty is the lender is asking for the repayment vehicle for the capital, and I'm not sure what to do should we be looking for some kind of policy just to keep them happy or will the loan note itself be an acceptable vehicle?

toonfish

you should be able to use the loan note as "other investment" - if not simply open a cash ISA and pay £10 per month in if they are insisting on policy numbers etc.