Your home may be repossessed if you do not keep up repayments on your mortgage.

This comparison includes all interest only mortgages.
We are a comparison website that's authorised and regulated by the FCA. How our site works.
HSBC 2 Year 2.95% Discount Special
0800 077 4270
Maximum LTV
60%
Initial Rate
0.99% variable
for 24 months
Subsequent Rate
3.94%
Overall Cost for Comparison
3.6% APR
Post Office 2 Year 1.05% Fixed
Maximum LTV
60%
Initial Rate
1.05% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year BBR+0.58%
Maximum LTV
60%
Initial Rate
1.08% tracker
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year 1.18% Fixed
Maximum LTV
60%
Initial Rate
1.18% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year 1.19% Fixed
Maximum LTV
75%
Initial Rate
1.19% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year BBR+0.74% Incentives
Maximum LTV
75%
Initial Rate
1.24% tracker
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year 1.25% Fixed Incentives
Maximum LTV
60%
Initial Rate
1.25% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
TSB 2 Year BBR+0.79%
0333 3314495
Maximum LTV
60%
Initial Rate
1.29% tracker
until 31 Oct 2017
Subsequent Rate
3.99%
Overall Cost for Comparison
3.8% APR
TSB 2 Year BBR+0.79%
Maximum LTV
60%
Initial Rate
1.29% tracker
until 31 Oct 2017
Subsequent Rate
3.99%
Overall Cost for Comparison
3.8% APR
Available via brokers only.
Post Office 2 Year 1.35% Fixed + Incentives
Maximum LTV
75%
Initial Rate
1.35% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Post Office 2 Year 1.38% Fixed
Maximum LTV
75%
Initial Rate
1.38% fixed
until 30 Sep 2017
Subsequent Rate
4.49%
Overall Cost for Comparison
4.0% APR
Santander 2 Year 1.39% Fixed
Maximum LTV
50%
Initial Rate
1.39% fixed
until 02 Oct 2017
Subsequent Rate
4.74%
Overall Cost for Comparison
4.3% APR
Santander 2 Year 1.39% Fixed Remortgage + Cashback
Maximum LTV
50%
Initial Rate
1.39% fixed
until 02 Oct 2017
Subsequent Rate
4.74%
Overall Cost for Comparison
4.3% APR
Available for remortgage only.
Santander 2 Year 1.39% Fixed Remortgage
Maximum LTV
50%
Initial Rate
1.39% fixed
until 02 Oct 2017
Subsequent Rate
4.74%
Overall Cost for Comparison
4.3% APR
Available for remortgage only.
TSB 2 Year BBR+0.89% Remortgage + Cashback
0333 3314495
Maximum LTV
60%
Initial Rate
1.39% tracker
until 31 Oct 2017
Subsequent Rate
3.99%
Overall Cost for Comparison
3.7% APR
Available for existing customers only. Such mortgages might not be listed on the lender's website. Available for remortgage only.
TSB 2 Year BBR+0.89% Remortgage
0333 3314495
Maximum LTV
60%
Initial Rate
1.39% tracker
until 31 Oct 2017
Subsequent Rate
3.99%
Overall Cost for Comparison
3.7% APR
Available for remortgage only.
TSB 2 Year BBR+0.89% Remortgage
Maximum LTV
60%
Initial Rate
1.39% tracker
until 31 Oct 2017
Subsequent Rate
3.99%
Overall Cost for Comparison
3.7% APR
Available for remortgage and via brokers only.
Virgin 2 Year BBR+0.89% Remortgage
0333 222 0201
Maximum LTV
65%
Initial Rate
1.39% tracker
until 01 Sep 2017
Subsequent Rate
4.79%
Overall Cost for Comparison
4.4% APR
Available for remortgage only. Interest only mortgages are not available where property value is less than £500k or where combined applicants income is less than £100k. Maximum LTV is 70%.
Virgin 2 Year BBR+0.94%
0333 222 0201
Maximum LTV
70%
Initial Rate
1.44% tracker
until 01 Sep 2017
Subsequent Rate
4.79%
Overall Cost for Comparison
4.4% APR
Interest only mortgages are not available where property value is less than £500k or where combined applicants income is less than £100k. Maximum LTV is 70%.
Virgin 2 Year BBR+0.94% Remortgage
0333 222 0201
Maximum LTV
70%
Initial Rate
1.44% tracker
until 01 Sep 2017
Subsequent Rate
4.79%
Overall Cost for Comparison
4.4% APR
Available for remortgage only. Interest only mortgages are not available where property value is less than £500k or where combined applicants income is less than £100k. Maximum LTV is 70%.

We provide an independent comparison service free of charge but we may receive a commission from some of the companies we refer you to. These are indicated with purple buttons.

How to Find the Best Interest Only Mortgage Deals

With interest only mortgages, you need to fully understand how interest only mortgages work so you can decide if they're the right option for you, and if so find the best deal.

The reality is that interest only mortgages are actually one of the more simple types of mortgage.

Essentially they are a bit of a "does what it says on the tin" mortgage in that your repayments pay off the mortgages interest only.

The alternative is a repayment mortgage where your monthly repayments are used to pay down your mortgage borrowing as well as the interest on your debt.

The main benefit of an interest only mortgage is primarily the fact that it allows you to pay a smaller amount each month in return for owning your own home. It's for this reason that this type of mortgage is so popular with first time buyers.

The main drawback of an interest only mortgage, and one that you must consider before you apply, is that even if you make every single one of your monthly repayments, you'll still owe the mortgage company the full amount you borrowed at the end of your mortgage term.

This is because your repayments haven't been paying down the capital, simply servicing the interest on the loan. As such, you'll need to find an alternative means of settling your mortgage debt.

The most common way to do this is to save or invest throughout your mortgage term so you have the money available by the time it is due.

An alternative is to take out a deal with the best interest only mortgage rates for a short while and then, when you're in a better financial situation, switch to a repayment mortgage so that you're paying down your borrowing too.

Understandably, when looking for the best interest only mortgages the majority of people will look for the lowest interest rates first.

However, it is important for you to remember that these are not the only thing that should be considered because the terms of the agreement will differ with each mortgage provider and the importance of these should not be underestimated as they may incur extra charges that could make a different mortgage a better option.

When you factor in any additional potential charges associated with your application for interest only mortgages or punitive payments should you wish to start paying off all or some of your outstanding balance early, the interest rate you originally thought was a good deal could actually leave you paying more than other slightly higher mortgage deals.

Featured guide

How to find the best mortgage for you

A mortgage is a path to buying the home you want but it's also likely to be the biggest financial commitment you ever make. So, finding the best rates & the most suitable mortgage package is vital, here's how.

Popular guides

How to get a fair financial divorce settlement

Divorcing may be something you never thought you'd experience, but even if it's unexpected you'll need to protect your finances as well as your heart. We examine how to organise your finances through a divorce.

Is Amazon Prime worth It?

For 79 a year, Amazon Prime offers one-day delivery, instant video streaming and multiple extra features for customers, but does it offer good value?

Can you transfer an ISA and open a new one in the same year?

ISAs are a great way of getting more from your money, but with the tax man looking over your shoulder you have to play by certain rules in your quest to avoid plummeting interest rates. Here are your ISA transfer questions answered.

Related categories