April Mortgages has launched an additional range of residential interest-only mortgages, with fixed rate options starting at 5.25% for terms of 5-, 10-, and 15-years.
Borrowers can access loan terms ranging from 5- to 40-years and a loan-to-income ratio of up to 6x for those with a minimum equity of £200,000 or £300,000 in London.
There are no early repayment charges (ERCs) for customers who move home or pay off their mortgage in full from their own funds.
Additionally, borrowers can make uncapped overpayments to reduce their balance without incurring any penalties.
Loan sizes range from £50,000 to £1,000,000, with loan-to-value (LTV) ratios of up to 60%.
Rachael Hunnisett, director at April Mortgages, said: “The interest-only market has been crying out for modernisation for many years.
“With the launch of our game-changing interest-only mortgages we are bringing a much-maligned product back to life, and ensuring that it is fit-for-purpose for today’s market.
“We are offering borrowers long-term financial security with the flexibility that comes from penalty-free overpayments and being able to move home or redeem their mortgage in full from their own funds without facing any ERCs.”
Hunnisett added: “While the number of interest-only mortgages have been falling in recent years, we firmly believe they are an important tool that give homeowners greater control over their finances and the ability to manage their mortgage payments more effectively.
“For example, in the current interest rate environment, many older homeowners with significant equity could benefit from interest-only arrangements as they transition towards retirement ahead of downsizing.
“In an era where financial literacy is rising, we’re championing a return to holistic advice – giving brokers and their clients access to the toolkit they need to support empowered, financially savvy consumers.”
