I have an interest-only mortgage and I’m a bit concerned in case the rate goes up
Q My current fixed-rate mortgage deal ends about 18 months before my mortgage comes to an end in 2022. It’s an interest-only mortgage so the last £40,000 should be paid off by my endowment (it was meant to pay off £65,000 but underperformed so this is their latest prediction, and I am too late to make any claim about that). My bank has told me I can’t take out another deal and will have to go on its standard variable rate for the last 18 months of the mortgage. I am a bit concerned in case the rate goes up and I get stung. It seems very unfair. Not only have I had to pay off an extra £25,000 because of the poor investment vehicle but I now might have to pay more interest.
Is there any course of action I can take to improve this situation? Should I remortgage again at some point so I can fix until the end of the term?
AB
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