Finding the Best Interest-Only Mortgage Lenders

Which mortgage lenders offer the best rates on buy to let products? Find out with our independent guide to choosing the most suitable lender for your interest-only mortgage deal.

Finding the Best Interest-Only Mortgage Lenders

Interest-only mortgages have become a less common product, and the Revolution team deals with multiple enquiries asking for help working out which lenders offer the best products or the most competitive rates.

Lenders all work on their own criteria, and so it can be challenging to work out who to apply to, particularly if you have been turned down for lending from a high street bank or mainstream provider.

In this guide, the mortgage brokers team runs through the criteria that lenders will work to, and how to find the right lending. For tailored support with your interest-only mortgage requirements, give the team a call on 0330 304 3040, or drop an email to info@revolutionbrokers.co.uk.

Which UK Mortgage Providers Offer Interest-Only Products?

Lots of lenders offer interest-only lending, although this is becoming less common. High street lenders may have strict criteria that limit the number of applicants they will accept.

How Do Eligibility Criteria Work for Interest-Only Mortgages?

Most lenders will look at the following factors before deciding if they can offer to lend:

  • Your deposit, and the Loan to Value ratio

Most interest-only mortgages need a higher deposit than repayment lending - often around 25% as a minimum. As an example, some of the larger high street lenders do have interest-only products, but with a maximum cap of 75% Loan to Value - this includes HSBC, Lloyds, Barclays and the Post Office bank.

  • Your repayment strategy

Lenders need to know how you will repay the loan balance at the end of the term. Some lenders will consider a plan to sell the property acceptable, but many will not.

Providers may also require you to receive independent financial advice before proceeding with an interest-only application - such as Barclays. Other lenders, such as Halifax and Santander, do not have such a requirement but will ask for updates throughout the mortgage term to ensure your repayment strategy remains viable.

Can I Get an Interest-Only Mortgage on a Residential Property Purchase?

You can - although interest-only loans are most common in the buy to let property sector. However, lenders can offer residential interest-only mortgages.

The process will consider your affordability rating, as well as how stable your repayment plan is.

Which are the Best UK Lenders to Apply to for an Interest-Only Mortgage?

Initially, we'd advise against contacting your existing mortgage provider or bank - because it is highly likely that you will achieve more competitive rates by comparing products from across the interest-only lending market.

Your bank may also reject your application, leaving a mark on your credit score, which can be problematic when applying to a more suitable lender.

Online calculators can be useful in getting a rough idea of costs and maximum borrowing values, but are only ever indicative and should not be used as the basis for taking out lending secured against your home.

For help understanding which lenders are most likely to accept your application, and offer the most appealing terms, contact Revolution on 0330 304 3040.

Which UK Interest-Only Lenders are Most Likely to Approve my Application?

The key to a successful application is to know the lender criteria and prepare your application in advance, to ensure you meet all the essential requirements.

It can be impossible to know, or find out, their criteria without using an expert for advice, so we always recommend contacting an independent broker for support with identifying the best lenders to apply to.

Expert Advice on UK Interest-Only Mortgages

For help identifying the right interest-only mortgage lender for you, comparing products, and securing competitive lending, contact Revolution Brokers on 0330 304 3040, or email us at info@revolutionbrokers.co.uk.

As an independent whole-of-market broker, we are proud to support every client in finding the best lending options, and the most attractive rates, leveraging our years of experience to secure successful outcomes.

Why Revolution Brokers?
  • Whole of market brokers

  • Mortgage that suits you

  • On time customer support

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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature. We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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