Your responsibilities
Repaying your mortgage at the end of your term
Is all or part of your Co-operative Bank mortgage held on an interest only basis? If so, it is important to plan how you will repay the outstanding balance on your mortgage at the end of its term.
Worried about repaying your final balance?
Don’t delay - the sooner you take action the better. There are a number of ways to close the gap between your outstanding mortgage balance and the value of your current investment, e.g. An investment (usually an ISA, endowment policy or pension) which is used to repay an interest only mortgage at the end of the term. The following options are also available:
- Switch
You could convert the outstanding balance of your loan to a Capital & Repayment mortgage over a term suitable to you up to a maximum age of 75 years of age at the end of the term. We will not charge you for switching from an interest only repayment mortgage to a Capital & Repayment mortgage. This option will ensure that your mortgage will be repaid at the end of the term. If you wish to discuss this matter further please contact us on 08008 404 993.
- Overpay
Making additional repayments will give you the opportunity to reduce your mortgage balance more quickly than your current interest only plan, reducing the amount outstanding on your loan as well as the amount of interest you have to pay each month. Early repayment charges may apply with regard to overpayments, which will be clearly stated in your specific mortgage terms and conditions. If you wish to apply, please contact us on 08008 404 993.
- Extend
You could choose to extend the term on your current Interest Only mortgage. This will give you more time to ensure your repayment vehicle will have sufficient funds to repay the mortgage balance by the end of the new term. You could then review your existing investment or savings plan, start an additional investment or savings plan or progress alternative options. There is a £54 charge to administer this change. Please note this will be subject to our lending policy.
- Saving review
If you'd like to speak with someone regarding a savings plan or a repayment vehicle to pay off your mortgage at the end of the term, please contact your local Co-operative Bank branch.
- Independent Financial Advice
If you have any concerns regarding an existing repayment plan or you are unsure about which option is best for you then we strongly recommend that you seek advice from an Independent Financial Adviser.
You may wish to refer to information from the Money Advice Service website which can give you advice on how to make up a shortfall on your mortgage.
Please remember it is your responsibility to ensure that you have enough funds to repay your mortgage at the end of the term.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
