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Utah
Mortgages
Interest Only Utah Mortgages
Types
of Utah Mortgages >
Interest Only Utah Mortgages
- This is an arrangement where you're only paying off the interest
on the loan.
- None of your capital debt is being repaid directly. This is
supposed to have been repaid by the end of the mortgage term by
your having made simultaneous monthly payments into an investment
fund.
- The idea is that this fund has hopefully grown enough to pay
off the capital and leave you with a surplus.
- To do this your mortgage salesperson may offer you an investment
"side" or "by product" (i.e. what they'll
claim is a suitable type of investment to pay off the capital
part of the mortgage).
- Before accepting anything always shop around for others. (You're
probably looking for some type of ISA.)
- A typical arrangement might be an endowment mortgage- at least
before they fell badly out of fashion.
- In our view you'd be best off consulting an IFA. Make sure
that s/he specializes in investments.
The majority of mortgage providers no longer ask for proof of
an investment side/by product when confirming your mortgage.
- You should be very clear that if the investment is not a success
then you could lose your home - probably at the end of the mortgage
term ie when you're close to retiring.
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