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Endowment Mortgages.
An interest only mortgage has to be repaid in full at the end of
the term. One method of repayment is an endowment effected for a
similar term to repay the loan.
So for example, if you have taken out a loan of £100,000 for 25
years you need to take out a 25 year endowment policy with a sum
assured of £100,000 to hopefully repay the outstanding loan in
25 years time.
Endowment Mortgage Key Points.
It is important that you understand the risks involved with
endowment mortgages as there is no guarantee that the return
will be sufficient to repay the loan.
The death cover under the endowment policy must always be
sufficient to repay the loan.
For an overview of the basic features of the different types of
endowment please follow the link below. We've provided brief
explanations regarding: non-profit endowments; with profits
endowments; low cost endowments and unit linked endowments.
Please contact us if you have any questions.
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