Get a grip on your Interest-Only Mortgage

Risks associated with an Interest-Only Mortgage

If you have an Interest-Only Mortgage, all you pay on a monthly basis is interest. You do not make any monthly repayments on your mortgage before it reaches maturity. Once your Interest-Only Mortgage reaches maturity, you are expected to repay the full loan, for instance by using your savings. If you do not have any savings, you will be left with a debt. This will cause you to have to sell your house, renew your mortgage or take out another mortgage. There may be risks associated with this.

Check your Interest-Only Mortgage

Is and will your Interest-Only Mortgage remain affordable for you? You can schedule a meeting with a mortgage adviser to find out whether your finances will be adequate, now and in the future, for instance after you have retired or when you no longer qualify for mortgage interest tax relief. Schedule an appointment to find out whether you need to take action to keep your mortgage affordable.

How to repay your Interest-Only Mortgage?

  • You can build up capital over the term to maturity of the mortgage loan, for instance by saving or investing 
  • You can make repayments on your mortgage, either as a lump sum or on a monthly basis 
  • You can change your mortgage to a mortgage that requires monthly repayments You can sell your home 
  • Our advisers would be happy to discuss your options with you, without obligation.

Aspects to consider if you have an Interest-Only Mortgage?

  • You may have a debt when your mortgage is due to be repaid
    If you are unable to repay your Interest-Only Mortgage once it has reached maturity, you will be left with a debt. This will cause you to have to sell your home, renew your mortgage or take out another mortgage. There may be risks associated with this, for instance because the proceeds from the sale of your home are not high enough to pay off your debt or because your pension benefits do not allow you to secure a new mortgage or renew your existing mortgage.
  • Mortgage interest tax relief limited to 30 years
    Starting from 2001, you have 30 years to qualify for mortgage interest relief. After 30 years, you will no longer be eligible for a tax refund. This may cause your monthly expense to rise sharply. 
  • Your monthly expense may rise
    Your monthly expense may rise or fall as your mortgage interest changes, for instance if your fixed-interest period has expired or if you switch mortgage providers. This also applies if you change your mortgage to a mortgage that requires monthly repayments, such as an Level-Payment Mortgage or a Straight-Line Mortgage. 
  • The value of your home may have fallen
    If you want to sell your home, the proceeds from the sale may be lower than your mortgage, causing you to be left with negative equity. You can reduce this risk by making repayments during the term to maturity of the mortgage. 
  • Lower income after you have retired
    When you retire, you may suffer a loss in income or your pension benefits may be lower than expected. This may cause you to have trouble paying your mortgage.

Get a grip on your Interest-Only Mortgage in Internet Banking

Simply go online and visit the secure environment of Internet Banking or use the Mobile Banking app to make repayments or change your mortgage type. Remember to check your options and the consequences for your monthly expense first. Once you have done that, you can adjust your mortgage yourself:

  1. Log on to Internet Banking using your identification code or e.dentifier 
  2. Click on your mortgage’s account number in the overview
  3. Click on the change you want to make at the top
Schedule an appointment with a mortgage adviser if you want to discuss your options.

Reasons for taking out a mortgage from ABN AMRO

Stay on top of your mortgage

Track your mortgage on Internet Banking or in the Mobile Banking app. It’s secure and easy.

Make changes to your mortgage yourself

From changing the interest rate to making additional repayments. Making changes to your mortgage couldn’t be easier. You can do it yourself online.

Help from an adviser

If you have any questions about mortgages, simply go online and schedule an appointment with an adviser through Video Banking or over the phone.