“Although the amount of new interest-only mortgages taken out in 2021 is small at 3% of total lending (32,000 loans), there is still a place for this type of loan.
“There are one million interest-only loans outstanding and some borrowers will be unable to repay the capital when their mortgage matures. They are likely to be over 50 years of age and this area of the mortgage market is very underserved. People may feel their only option is to sell but they could take out another interest-only mortgage to pay off the first one.
“As we take into account all of a customer’s income, including pensions, investments and any other assets, many people will find they are eligible for a mortgage after all.”
Leon Diamond, CEO at LiveMore