Are you sitting on an Interest-Only Ticking Timebomb?Are you sitting on an Interest-Only Ticking Timebomb?

Caz Blake-Symes • February 9, 2018

Call Bristol, Bath or Exeter Mortgages Online for Expert AdviceCall Bristol, Bath or Exeter Mortgages Online for Expert Advice

Hundreds of thousands of homeowners could be at risk of losing their homes by ignoring how they will pay off their mortgage, a regulator has warned. Nearly one in five mortgage-holders has an interest-only home loan, meaning they would need savings or other funds to pay a final lump sum. The Financial Conduct Authority (FCA) said the end of these mortgage terms would peak in the next 10 to 14 years.

Interest-only deals allow borrowers to pay off the amount borrowed only when the mortgage term ends, usually after 25 years, but there is concern that a host of homeowners do not have plans in place to pay the final bill. The FCA said that 1.67 million full interest-only and part-capital repayment mortgages were still outstanding, representing 17.6% of all mortgages in the UK. One peak of these final bills has come in the past year or so, for those who took out endowment policies in the 1990s and 2000s.

Less affluent, middle-aged homeowners who often converted to interest-only deals in 2003-09 - who are concentrated in the South West, East and North West of England, as well as London and the West Midlands - will see their final repayment demand come in 2027-28. The regulator said that lenders had improved their communications with customers at risk since its initial report on the issue five years ago.

What are your options…


  • Some believed that they had an adequate repayment plan in place, while others were simply burying their head in the sand.
  • Some had little trust in their lender, so were suspicious of the letters reminding them to have a repayment plan in place.
  • Borrowers are urged to talk to their lender or an Independent Mortgage Broker as early as possible, otherwise they would restrict their options over time of paying off their mortgage.

What the experts say ..

"We are very concerned that a significant number of interest-only customers may not be able to repay the capital at the end of the mortgage and be at risk of losing their homes," said Jonathan Davidson, executive director of supervision at the FCA.

Hannah Maundrell, from comparison service Money.co.uk, said : "You may be able to remortgage your property, extend your mortgage to give you time to raise the money to pay it back or look into taking out another mortgage from a different lender. If you're at risk of losing your home, there are government schemes that could help..”

How Bristol, Bath and Exeter Mortgages Online can help…

There are a number of options that we can help you with.


  1. Keep calm and take advice before making any rushed decisions.
  2. Call us today for a FREE no obligation consultation with one of our Expert Advisers.
  3. We can look at your existing mortgage and options may include,


  • Restructuring
  • Changing to another lender
  • Changing to a repayment mortgage
  • If you are over 55 an Equity Release plan may be an option.

If you would like to talk to us about your Interest-Only mortgage or any Mortgage or Protection queries, please call us to book your FREE consultation.

www.bristolmortgagesonline.comTel 0117 325 1511

www.bathmortgagesonline.com Tel 01225 584 888

www.exetermortgagesonline.com Tel 01392 690 888

Boost to buying power from changes to affordability tests

By Caz Blake-Symes • May 1, 2025
Adapted from Zoopla’s April 2025 Housing report I mage: The analysis uses average house prices from the house price index and for first-time buyers to assess mortgage payments at different mortgage rates applied to a 30- year mortgage, at different loan-to-values. One emerging trend that we expect to positively support market activity in the coming months is a relaxation in how lenders assess the affordability of new mortgages. While buyers focus on the mortgage rate they will pay, lenders also check whether the borrower can afford a 'stressed mortgage rate' at a higher level than the borrower will pay. ​ While the average 5-year fixed rate mortgage is around 4.5% today, many lenders are currently 'stress testing' affordability at 8-9%. This makes it harder to secure a mortgage without a large deposit. If average mortgage stress rates were to return to pre-2022 levels of 6.5% to 7%, this would deliver a 15-20% boost to buying power. ​ An average first-time buyer with mortgage repayments of £1,020pcm at a 4.5% mortgage rate would typically have to prove they could afford monthly repayments of £1,550pcm at an 8.5% stress rate. If the stress testing is relaxed to 6.5%, repayments would fall to £1,275pcm, boosting buying power. It's a similar pattern for the average homeowner, while the actual impact will vary by lender and type of borrower. ​ This change would consequently supporting demand and sales volumes, helping to clear the stock of homes for sale, rather than boosting house prices. Other existing rules and regulations that remain in place will continue to impact the availability of mortgage finance.  Comment from Phil Clark “This is potentially very exciting news and will give borrowers a greater choice of products if these rules are relaxed. Regardless of whether you are a First-time Buyer, Looking to move, remortgage or invest in property, there are a huge range of competitive mortgage deals on the market. I will be delighted to discuss your specific requirements and offer you the most suitable deal!” Please call Phil on 0117 3251511 or email info@swmortgages.com For more information about the Mortgage and Protection products we offer, please visit www.bristolmortgagesonline.com Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.

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By Caz Blake-Symes • March 31, 2025
This edition includes fantastic new mortgage products, updated guides for those with adverse credit, 17 great tips to follow before making and application and lots more. If you need help with any of the items covered, please call Phil on 0117 325 1511.

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Let us help you If you have a poor credit score or issues with your credit history.Call Phil on 0117 3251511 to discuss any credit uissues.

Zoopla House Price Index: February 2025

By Caz Blake-Symes • March 18, 2025
The housing market is resilient, supported by faster growth in average earnings. There are the most homes for sale in 7 years, which will keep price inflation in check. But are buyers missing opportunities in the flats market?
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Let Us Help You Improve Your Chances of Getting a Mortgage

By Caz Blake-Symes • March 11, 2025
Here at Bristol, Bath and Exeter Mortgages Online, we understand that getting your first mortgage, or even a remortgage, especially if your circumstances have changed, may look like an impossible task, but we are here to help. We hold your hand from your initial enquiry through to the completion of your purchase. It's not that tricky and there are ways you can improve your odds and boost your chances of a successful mortgage application.
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Fantastic Mortgage Rates from Bath Building Society

By Caz Blake-Symes • March 8, 2025
We are delighted to be able to offer our clients an incredible mortgage deal through Bath Building Society. Bath Building Society is currently offering market-leading discounted mortgage products designed to provide flexibility and great rates.

Check out our February 2025 Newsletter!

By Caz Blake-Symes • February 27, 2025
Check out our February 2025 Newsletter!

Some mortgage rates cut below 4% as competition picks up

By Caz Blake-Symes • February 19, 2025
Adapted from BBC Article by Kevin Peachey, Cost of living correspondent 13 February 2025 Two major lenders launched mortgage deals on Thursday with interest rates of less than 4%, as competition picks up in the sector. The prospect of further cuts in the base rate by the Bank of England has given mortgage providers confidence to reduce their own rates. But the attention-grabbing sub-4% deals by Santander and Barclays will not be available to all borrowers, particularly first-time buyers, and may come with a hefty fee. The return of such deals might prompt other lenders to follow suit after a period of tepid competition. Nationwide, the UK's biggest building society, has said it will reduce some of its rates on Friday. Mortgage deals with interest rates below 4% have not been seen since November. Across the whole market the average rate on a two-year fixed deal is 5.48%. The typical rate on five-year deals is 5.29%, according to latest figures from Moneyfacts. Time to decide Some tracker and variable rate mortgages move fairly closely in line with the Bank's base rate, which was cut to 4.5% a week ago. However, more than eight in 10 mortgage customers have fixed-rate deals. The interest rate on this kind of mortgage does not change until the deal expires, usually after two or five years, and a new one is chosen to replace it. About 800,000 fixed-rate mortgages, currently with an interest rate of 3% or below, are expected to expire every year, on average, until the end of 2027. That means a higher monthly bill for many homeowners on their next renewal, but there are signs that the rate they could pay is on its way down.  Bank of England governor Andrew Bailey said the interest-rate setting committee expected to be able to cut rates further "but we will have to judge meeting by meeting, how far and how fast". This will affect savers who are seeing lower returns, but could bring better news for borrowers. The Bank's next rates decision is on 20 March. Message from Phil Clark “Regardless of whether you are a First-time Buyer, Looking to move, remortgage or invest in property, there are a huge range of competitive mortgage deals on the market. I will be delighted to discuss your specific requirements and offer you the most suitable deal!” Please call Phil on 0117 3251511 or email info@swmortgages.com For more information about Mortgage and Protection please visit www.bristolmortgagesonline.com
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