Some people use the cash flow from the rent to improve quality of life and then sell the property for more than they paid due to increased value over time and use that to pay off the mortgage.

I took out an interest only mortgage in 2004. For the first 5 years or so I only paid the interest which was about 160 pound a month. When I started making more money I started making overpayments on it. I stuck with the interest only over the years and just kept making overpayments. I could increase or decrease when I liked.When the interest rates were low this made the best sense. Now the rates are going up and up I’m lucky enough to make extra overpayments and, hopefully, I’ll have my mortgage paid off two to three years early. I bought a 144 thousand pound house and now owe only 46 thousand with 6 years 8 months left.

I have only ever had interest only mortgages. My main goal , to make over payments of 10% . When the mortgages come up for renewal, i wouid make a massive over payment ( with the money i had saved ) , took out another mortgage and continued paying the 10% . That was over 11 years ago . Iam totally mortgage free on all my properties in london . That was the best thing i had ever done . Had some really cool people around me when i was 18 years old . I was so lucky and grateful. They use to tell me to listen with my ears and not my mouth 😂😂 😂😂 I had faith in them all , but was scared. Even thou i have done extremely well , as i was also Investing at the same time . Nothing will beat my properties for investment. As i was taught never sell , best ever advice, when it came to properties. I have always been good with money . Intrest only mortgages are for people who totally understand the concept, as its only a loan and as to be payed back . To be honest i didn't know they still did intrest only mortgages 🤦‍♂️🤦‍♂️🤦‍♂️🕴🕴🕴🕴🤐

Excellent explanation

If im a bank i would love for borrowers to pay intrest only so i can accelerate getting my money upfront.

JUST TODAY FAMILY MEMBER TOLD ME THERE PAYMENTS SKY ROCKETED , THEY TOLD ME THEY HAD INTEREST ONLY FOR 15 YEAR MORTGAGE , ONLY 68000 NOW THEY BEEN GIVEN 4 YEARS TO CLEAR IT AND THERE STRUGGLING IN THERE 60S , CANT COMPREHEND WHY THEY WOULD DO THIS AND WHEN LIKELY THERE PAYMENTS ON NON INTEREST WOULD OF BEEN ONLY 450 A MONTH AND WOULD OF BEEN PAID OFF IN 4 YEARS !!!!

Residential, agree, buy to let disagree. Capital appreciation drives the percentage of ownership over time. Example - buy a house in 2014 for 100k with a 25k deposit, fast forward to 2024 property price has increased to 200,000 and you owe 75,000. 2034 that house worth 400,000 and you owe 75,000. So it’s all about why you want interest only.

I got stung by the old version - the endowment mortgage. You paid a reduced sum which was invested to cover the capital sum at the end but almost never did. So you come to the end and are faed with a massive bill like I was and had to sell, It was mis-sold but those corporate punks Barclays never got nailed.

So sad for her but paying only interest is financial suicide.

Just pure stupidity. An interest only mortgage, is just that . I will never understand when landlords say " they own all these properties " , but in reality, they own nothing.. Mortgage = Loan = Debt .. If you have a mortgage, then the property is own by the bank and not the owner or landlord.. Untill the debt is 100% payed off , then its still a loan , which is debt . I dont understand why people get confused. Your example was sad to hear . Living the dream , coming to retirement , but have 2 massive debt hanging over them . They will have to sell one or both to pay of the debt or have massive saving to pay of the mortgages. Iam sure you told them that . Sorry, i dont understand why anyone wouid get confused? Same situation as leasing a car or leasehold property, its never yours 🤦‍♂️🤦‍♂️🤦‍♂️🤦‍♂️🤐🤐🤐

What is the actual purpose of an interest only mortgage then? You’ve essentially paid nothing 😮 I feel sorry for this woman. I haven’t finished the whole video yet so I’m sure I will find the answers lol

dribble