Specialist lender Accord Mortgages has launched interest only repayment options to its residential mortgage range.
New borrowers seeking up to 75% loan-to-value (LTV) who are able to repay the loan on an interest basis but are opting to pay the interest will benefit highly from the offer.
These borrowers are required to demonstrate that they have substantial repayment strategies at the end of the mortgage term, which could include existing funds or investments.
Accord will enable borrowers to use any sales of the mortgaged property at the end of the term to be used as a repayment strategy, where there is a minimum of £200,000 equity within the property and where the amount borrowed does not exceed 50% LTV.
Charles Canning, managing director of Accord Mortgages, said that he is pleased at the offer, as the policies reflect the needs of borrowers and brokers.
“Demand for interest only mortgages is increasing and for borrowers who have made an informed decision that this repayment method best meets their needs, we understand the additional flexibility it can provide,” he said.
“We’re confident the introduction of interest only options will be welcomed by brokers and borrowers looking for choice in the market,” he added. “To help brokers place interest only cases with us and ensure efficient turnaround times for clients we have dedicated interest only underwriters ready to answer any questions.”
Borrowers will also be provided with additional flexibility when managing their home loan, with Accord offering interest only repayment options on its offset mortgages.
Jeremy Duncombe, director of Legal & General Mortgage Club, commented: “Interest only is an important option for the right customers who have received appropriate advice from a mortgage broker.”
He added: “Our recent ‘value of a broker’ research demonstrates the importance of speaking to an intermediary and it’s great that Accord place similar value on their role. By introducing interest only, Accord continues to develop their range and offer more choice for the intermediary market.”