Interest-Only Mortgage Failed Payments 2025: What You Need to Know
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- Failing to make interest-only mortgage payments can lead to the mortgage provider taking legal action to repossess your property.
- You can manage failed payments by contacting your lender, discussing your situation and arranging a repayment plan.
- The risks include damage to your credit score, additional fees, and potentially losing your home.
- It's possible to recover from failed payments by creating a repayment plan, refinancing or switching to a repayment mortgage.
- The consequences of failed payments can include repossession of your home, a damaged credit rating, and potential legal action from the lender.
You may be wondering what happens if you fail to repay your interest-only mortgage, which is a valid concern.
According to the Financial Conduct Authority (FCA), over 40 000 interest-only mortgages will mature annually until 2032.1
However, some borrowers may not be equipped with the right repayment strategy or plan, resulting in them struggling to pay off their debt.
In This Article, You Will Discover:
As equity release experts, we're here to tell you that there are options to choose from to get yourself out of a sticky situation.
Let's find out now!
What Is an Interest Only Mortgage?
Equity release, a financial product designed for homeowners typically aged 55 and older, offers a pathway to release equity in home, providing financial freedom without the need to sell the property.
Whether through a lifetime equity release mortgage or a home equity release loan, individuals can unlock the value tied up in their homes.
This approach is detailed in resources like the Which? guide to equity release, offering comprehensive insights into choosing the best way to release equity.
Understanding what equity release is and exploring options, can significantly impact retirement planning, offering a strategic method to release home equity effectively.
What is a Failed Payment?
A payment that is not successfully processed, often due to insufficient funds, technical issues, or other reasons, leading to a payment not being completed as intended.