Interest-only mortgage resurgence

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Interest-only mortgages are making a comeback and not just for high earners or people with big deposits. As the name suggests borrowers repay only the interest on the capital sum, which is then paid off at the end of the term. They fell out of favour with the authorities when many people came to the end of the mortgage term but had no means to repay the original debt. The rise of equity release and retirement mortgages has prompted new lenders to enter the market and according to Moneyfacts, the financial information provider, there are now 33 interest-only mortgages to choose from.

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