UK First Time Buyers Benefit from Interest Only Mortgage Deals
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Interest only UK mortgages are often the best option for first-time buyers according to the Council of Mortgage Lenders (CML). The CML state that interest only mortgage deals will offer "financial breathing space".
First time buyers are usually at their financial affordability limits when they take out a mortgage, but with interest only mortgages, only the interest needs to be paid off. This usually frees up some extra money to put towards starting a family or purchasing a car.
Christopher Dean, from the CML."The main reason why someone would choose an interest-only mortgage is because their initial mortgage repayments would be lower than they would be on a repayment mortgage"
"For a first-time buyer, that might be quite an attractive option because… [it] means they've got more money in their pockets to… buy new furniture, decorate their new house, or whatever."
Despite interest only mortage providing some financial refief it is still very important that mortgage borrowers plan their finances properly.
By doing this, there will be no suprises when the interest only part of the mortgage ends runs out and capital payments are necessary.
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