Debt help


More then a million people in the UK with interest-only mortgages are facing financial trouble when the time comes to pay them off.

Approximately 2.6 million people have interest-only mortgages and it has been estimated by the Financial Conduct Authority that nearly half will not have the necessary funds to cover the final bill.

According to research from FCA, the average shortfall for those with interest-only mortgages is £71,000.

Those with interest-only mortgages (about a third of all UK mortgage holders) make monthly repayments to cover the cost of interest on the mortgage.

The full amount should be paid once the mortgage term matures, usually after 25 years. This should be funded with savings, inheritance or from the sale of a business.

These mortgages were popular in the 90s where they were often sold alongside an endowment policy. They were also popular during the last decade when homeowners were optimistic about rising house prices and wages.

Mortgage lenders have agreed to write to those with interest-only mortgages to ensure that they have a repayment method in place.

One of these methods will be to increase your monthly contributions so you start reducing the amount you owe. Most lenders will allow you to overpay by up to 10%. This will also reduce the loan-to-value (LTV) making it easier to remortgage.

Another option would be to switch to a repayment mortgage. This will cause your monthly repayments to increase as you will be paying off capital as well as interest so you need to budget and ensure that it is affordable.

Starting a savings account could also help ensure you have the necessary funds needed when your mortgage matures but you’ll need to make sure you pay enough into it and discipline yourself not to raid it.

Downsizing to a cheaper house will also enable you to free up some cash but you should make sure you can free enough cash by doing this.

If you find that you’re struggling financially you should speak to a properly regulated financial solutions provider.

The Debt Advisor is a member of The Debt Resolution Forum and is regulated by The Financial Conduct Authority no 606669.



Do you need help?

Specialist advisors are available who can advise you on the most appropiate solution to bring you relief from debt

More Posts From The Debt Advisor

Beverley Budsworth – The Debt Advisor FCA regulated Debt Solution Provider Judgments increasing against consumers Judgments in first quarter of...
Debt Relief Order changes – more people will qualify
The criteria to qualify for a Debt Relief Order “DRO” changes on 29 June 2021.  This will mean that around...
Mental Health – How to help yourself recover “Post Pandemic”
Mental Health - How to help yourself recover “Post Pandemic” PPSD* (post-pandemic stress disorder) Not (yet) an official term but...
Breathing Space debt respite scheme
What is Breathing Space? From May 4th 2021 new legislation will be brought into place to allow approved debt advisers...
How to improve my Credit Score?
Within the UK there are 3 main credit reference agencies, TransUnion, Equifax and Experian. All 3 work with banks, building...

We are proud of our 5* TrustPilot customer reviews

We are proud of our 5* TrustPilot customer reviews

The Debt Advisor Accreditations

There is an alternative free-to-consumer debt services from the Money Helper.

The Debt Advisor Accreditations

There are alternative free-to-consumer debt services from the Money Helper.

We’re ready to help with any debt problems

Social media

The Debt Advisor has a long and rich history of helping people and companies get past their debt problems. We welcome people to get acquainted with our company, history, team and to listen to the stories from the people we have helped.

Alternative free-to-consumer debt services are available from the Money Helper website.

Customer Support

18-22 Lloyd Street, Manchester, M2 5WA

Monday to Thursday: 9:00 am – 7:30 pm
Friday: 9:00 am – 3:30 pm

Company Registration: 06248441 | The Debt Advisor Limited is Authorised and regulated by the Financial Conduct Authority Reg No: 659920.

All debt solutions should be very carefully considered. Please note, if you are struggling with debt issues and need advice on your options, we’ll take a look at your financial situation and explain the available options. If it is appropriate to refer you to one of our trusted providers for a solution, we may get a fee for introducing you, or for the preparatory work we complete. Fees are payable if ongoing services are provided.

Copyright © 2022  The Debt Advisor | Privacy Policy | Cookie Policy | Complaints | Careers