Remortgaging your property can be an effective way of saving money and reducing the overall cost of your mortgage. However when searching for a suitable offer, it may be wise to calculate the cost of any given mortgage deal before agreeing to remortgage your property with a new lender.
Using an interest only remortgage calculator, you can determine which mortgage deal is best for you and whether using an interest only repayment method could benefit you in the long term.
What is Interest Only?
Interest only is a type of repayment method you can choose when arranging a mortgage deal. You will be required to repay monthly instalments of the interest accumulated each month, while paying separate instalments into a personal savings account.
If you have a knack for saving or you have a steady income that allows you to save and control your finances easily, the interest only repayment method could be the right choice for you because you are not limited to a certain figure each month.
Take a look at our mortgage comparison tables above for a list of offers from different providers.
As well as using an interest only remortgage calculator to assess offers, it is also worth considering how your new loan will be repaid.
An endowment remortgage requires that you repay your loan though a savings or life insurance policy. This option may be more expensive and less flexible than an ISA remortgage.
This option involves repayment of your mortgage loan through an Individual Savings Account (ISA). If you choose this option you may be rewarded by potential tax benefits. However, if interest rates remain low throughout the duration of your mortgage term, it is possible that the interest accumulated on your savings will not cover your mortgage loan.
Pension scheme remortgages
This type of remortgage deal involves using part of your mortgage loan to repay your debt. This could be particularly helpful to self-employed people or those in a higher tax bracket.