Make interest only payments
Need a bit of time to get your budget back on track?
Switch to interest only payments for six months, with no impact on your credit score.
How it works
- You’ll make interest only payments towards your mortgage for six months, with no impact on your credit score.
- You can cancel at any point, but you can only apply once.
- Your monthly payments will increase at the end of the reduced payment period to collect the amount you haven’t paid.
- You’ll pay back more on your mortgage overall if you make interest only payments for six months.
- If you miss an interest only payment and don’t catch up, we might cancel the arrangement.
Your reduced monthly payment amount will be fixed
Your interest only payment amount will be fixed for six months - even if your mortgage rate changes during that time.
Usually, your interest only payments will be worked out using your current interest rate. However, if your rate’s due to change next month, we’ll use that rate instead.
Any other changes in interest rate will apply to your mortgage, but not your payments. Once your reduced payment period comes to an end, we’ll write to confirm your new increased monthly payment amount and total mortgage cost, including any interest added because of interest rate changes.
Here are some examples of how making interest only payments for six months can impact your monthly payments and the total amount payable.
Important: Your monthly payment and total mortgage cost will increase at the end of the reduced payment period to collect the amount you haven’t paid.
These examples are for illustrative purposes only and assume there are no other changes to the mortgage over the remaining term.
Before you apply, make sure you:
- understand your monthly payment and total mortgage cost will increase at the end of the reduced payment period
- are up to date with your payments and don’t have a Buy to Let mortgage
- don’t already make interest only payments on all of your mortgage
- aren’t currently taking a mortgage payment holiday
- have consent from everyone named on your mortgage.
How will this impact my mortgage payments?
To find out how making interest only payments will impact your mortgage, please enter your details into our calculator.
You’ll be able to find the information we need on your latest mortgage statement or any letters we’ve sent you.
If you have multiple sub-accounts, you’ll need to enter their details individually and add the payment amounts together. What are sub-accounts?If you’ve made any changes to your mortgage, it could be a mix of different interest rates, terms, and balances. These are known as sub-accounts. Each sub-account has its own individual monthly payment, which we add together to make up your total monthly mortgage payment. You’ll be able to find out if you have sub-accounts on your latest mortgage statement or any letters we’ve sent you.
You must have at least six months left on your current mortgage to apply to switch to interest only payments.
Your monthly payments:
Once your interest only payments have finished, the amount you pay each month will go up.
Your current monthly payment amount:
While making interest only payments, you’ll pay:
After six months of interest only payments, you’ll pay:
Remember to add the details of any sub-accounts individually and add them together to get your total monthly payment.
These figures are for illustrative purposes only.
*Provided by Bank of Scotland
If you change your mind
If you decide to cancel the payment arrangement before the six months comes to an end, you can let us know by completing our cancellation form.
Please remember, you can only apply once.
You could lose your home if you don't keep up your mortgage repayments
How we process your personal information
Your personal information will be held by Birmingham Midshires, which is part of Lloyds Banking Group. More information on the Group can be found at www.lloydsbankinggroup.com. It’s important you understand how the personal information you give us will be used. Therefore, we strongly advise you read our full privacy notice, which you can find at https://www.bmmortgages.co.uk/existing-customers/security-and-privacy/ or you can ask us for a copy.
If you have any questions or require more information about how we use your personal information, please contact us.