interest only mortgage

[ifek2006]

what are repayment vehicles used in conjunction with interest only mortgages?

[Oneeyedvic]

Savings, ISAs, Endowments (though this is out of favour), are the usual two. If confident enough, you could speculate on your own with regard to shares.

Also, bear in mind that some IO mortgages are there to speculate on the rise of the property value and not to repay.

[antiguru]

Were you asking how they work too? The theory is that you save some money in one of these vehicles (let�s call it a pot) as well as paying off the interest on the mortgage. The pot goes on getting bigger as the investments grow through interest and dividends etc until the pot is worth more than the mortgage capital itself. The aim is that the investment and the life of the mortgage are aligned so that there comes a point when the pot can be used to pay off the mortgage capital amount. In the good old days there would be change in the pot too.

Hope this helps.