We cover key aspects of interest-only loans, such as what an interest-only mortgage is, their impact on your mortgage repayments, and how long a bank may allow you to maintain an interest-only loan. We also explore:
- when an interest-only loan might be favourable for you
- the potential benefits
- what you need to know before considering one for your financial strategy
- the potential downsides, including how they can affect your serviceability, and
- the process of switching from interest-only to principal and interest payments.
Interest-only loans have become a popular option for many borrowers, particularly property investors, looking to manage their cash flow more effectively. By understanding both the advantages and drawbacks, this video equips you with the knowledge to make an informed decision about whether an interest-only loan is right for you.
Disclaimer: This article is intended to provide only a summary of the issues associated with the topics covered. It does not purport to be comprehensive nor to provide specific advice. No person should act in reliance on any statement contained within this article without first obtaining specific professional advice. If you require any further information or advice on any matter covered within this article, please contact an adviser from mortgagehq.
