Mortgages▼
Purchase▼
Remortgage▼
Buy To Let▼
Self Employed▼
About Us▼
Mortgages
Protection
About Us
Tools & Guides
There are three different mortgage repayment types. In this guide we explain the differences between them and provide you with as much information as possible to allow you to make an informed decision when taking out your next mortgage.
There are three different ways of repaying your loan. These are repayment, interest-only, and combination of repayment and interest.
With Alexander Southwell Mortgage Brokers, you have a choice of payment methods.
We will recommend and advise you on which is going to be most suited to you.
A mortgage consists of the capital sum and interest, expressed as a percentage.
Mortgage affordability calculator will help you make sure you can afford your monthly repayments.
You pay back the capital and the interest together and repay the capital at the end of the mortgage term.
With an interest only mortgage, you initially only pay back interest on a monthly basis.
A repayment mortgage is a home loan where you repay a bit of the capital and some interest each month.
As long as you meet all your monthly payments you're guaranteed to have repaid your entire loan by the end of the mortgage term.
The amount you pay each month is calculated so that you pay off the full amount owed.
You will own your property outright once your mortgage is paid off.
We will compare mortgages you, let you know what your repayments on your mortgage will be, compare interest rate and let you know which option are best for your property investment.
Interest-only mortgages you only pay the interest due on the amount you borrowed each month. You don't pay off any of the loan amount.
This means if you are unable to pay off your mortgage & you still owe the lender at the end of the mortgage term you risk your house and it may be repossessed.
This means monthly payments will be less than if you had a repayment mortgage.
Total cost of an interest-only mortgage will be higher because you'll be paying interest on the full loan amount throughout the mortgage term.
It’s your responsibility to make sure you have enough money to repay everything you owe at the end of the term.
If your plan doesn't give you enough money you owe, you may have to sell your property.
If your savings or investment plan doesn’t cover the full amount, you’ll be responsible for paying the difference.
Your mortgage lender can demand repayment, and they’ll charge you interest on any outstanding balance until it’s repaid.
Part and part. You can combine both interest only and repayment mortgages, usually for a set period each for the duration of the mortgage.
This will provide you with a lower monthly payment while still paying back some of the capital every month.
It will NOT repay the whole mortgage with these mortgage repayments but at the end of the term your balance will be lower.
Lenders will make sure you have a repayment strategy in place.
It's your responsibility to be sure it is on track to pay off the capital at the end of the mortgage.
If it’s not on track you will find it difficult to remortgage or switch to another lender.
Some lenders might ask for a larger deposit if they have an interest-only mortgage.
But a suitable repayment plan is likely to mean paying regularly into savings or investments and could include pensions and other properties.
The simple is no. In actual fact a limited number of lenders accept interest at all, the lenders will consider this option have a lot of particular stipulations attached to their products which doesn't make it easy to get accepted for.
It is much easier getting buy to let interest only mortgage.
It is always worth gaining additional knowledge around what type of product you would like and understanding the different products on offer. We can provide you with all of this information.
We also have a mortgage product guide explaining the different products which lenders offer, click here to find out more.
We can help you with all your mortgage and protection needs, get in touch with our mortgage brokers today.
Getting the keys to your new home is only part of the story. Making sure you can actually keep them, no matter what life throws at you, matters just as much.
As the Co-Founder and Director of The Fee Free Mortgage Broker and Alexander Southwell Mortgages, my role goes far beyond arranging property finance. I am the protection specialist for the business, which means my absolute passion is making sure families have the right financial safety net in place.
I live and work alongside my partner, Jamie, near North Baddesley and Romsey on the outskirts of Southampton. I started my career as an estate agent at Connells, learning the home buying journey from the ground up and supporting clients through one of the most exciting and nerve wracking processes of their lives.
From there, I moved deeper into financial services, joining Re-Assured as a specialist insurance broker. Working in a dedicated protection environment gave me an expert level understanding of life insurance, critical illness cover, and income protection. It taught me how to have honest, comfortable conversations with families about the things they would rather not think about, but absolutely should.
In 2019, I brought that expertise to our family business. Together, Jamie and I have grown a local, independent brokerage that genuinely looks after clients for the long term.
Taking on the biggest financial commitment of your life without a plan for what happens if your income stops is a risk no family should take.
My belief in this comes from more than professional experience. As a mother, I understand instinctively what it means to want to protect the people you love. That personal understanding shapes every single conversation I have with our clients. It is never a tick box exercise or a product sale. It is a genuine, warm discussion about what your family would need to stay safe in your home.
I look after the full range of personal protection, offering whole of market advice across:
Because Jamie and I run the day to day operations together, there is a personal dimension to how we work. Outside of the office, I love nothing more than spending time with my family, and if there is baking happening in the kitchen with our son, even better. That sense of home and family genuinely informs the care I bring to every client.
Whether you are a first time buyer looking at cover for the first time, or a growing family reassessing your current policies, I am here to help you get it right. There is no broker fee for our advice, just honest guidance to keep your home safe.
