Interest-only mortgage repayments soar 70 per cent

Borrowers who took out interest-only mortgages have seen the cost of servicing their loans soar by more than 70 per cent since the European Central Bank (ECB) began hiking interest rates 18 months ago.

23rd June, 2007

Borrowers who took out interest-only mortgages have seen the cost of servicing their loans soar by more than 70 per cent since the European Central Bank (ECB) began hiking interest rates 18 months ago.

Interest-only loans were popular with buy-to-let investors and some first-time buyers as they allowed borrowers greater spending power and lower monthly payments than loans that also required the principal to be repaid.

Many investors took out these loans, which were described as high...

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