Interst Only mortgage should I change to part & part?

paul4798

Hi there,

I have a £45000 interest only mortgage with an endowment running i have 15 years to go on my mortgage and have had the letter advising may be a shortfall on my endowment.

I have failed in misselling endowment case so should I consider changing my mortgage type to part interest part repayment?

Advice would be appreciated.

thanks

Paul

minimike2

Repayment will usually be the best way forward, I would suggest you put as much onto repayment as you can afford to.

herbiesjp

You coulkd indeed go part and part assuming the mortgage is affordable to you.
You could cover only the shortfall amount on a repayment basis, or if affiordability allows a higher amount.

By doing that, you are relying less on the endowment to pay off your mortgage, and you could then have those maturity proceeds in your pocket at the end of the policy

sarkin

YES YES YES

sarkin

convert the mortgage to repayment and use the endowment as a savings plan with a bit of life cover as well.

dunstonh

Have you reviewed the endowment to see if the shortfall is likely or not. It may be better than you expect or worse. Projections alone are not a reliable source of information.

talkinpeace

I have stuck with interest only but have a written plan (that my bank have seen) to make regular capital repayments ten months of the year - I'm lucky it's a flexible mortgage. On target to have zero balance by end of term in 6 years.