Repayment mortgage
A repayment mortgage is one where each payment covers both interest and part of the loan, so the debt is fully repaid by the end of the term.
Also known as: capital and interest mortgage, repayment mortgages
In the early years most of each payment goes on interest, so the balance falls slowly at first and faster later. If you keep up the payments, you own the property outright at the end of the term.
Use a mortgage calculator to compare repayment and interest-only payments, and to see how a change in rate would affect you.
An authorised mortgage adviser can explain how this applies to your circumstances, and MoneyHelper offers free guidance. Your home may be repossessed if you do not keep up repayments on your mortgage.
Related terms
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