Interest Only Mortgages - Mortgages | Royal Bank

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

Helpful information Interest only mortgages

The capital you borrowed on an interest only basis must be repaid in full at the end of your Mortgage term.

You need to have a repayment plan to repay your capital. You should review your repayment plan on a regular basis to ensure that it remains on track. We may contact you from time to time and ask you to show us that you’re in a position to pay off your mortgage at the end of the term.

If your repayment plan is not on track, you need to take action now either to save more or switch to a repayment mortgage. There is no charge to switch to a repayment mortgage if this is a suitable option for you.

If, since getting your mortgage, you have decided that you will pay off your capital at the end of your mortgage by selling your property, you should remember that the value of your house will depend on house prices at the time of sale. If you cannot sell your property for the value you expect, you may not be able to pay off your mortgage in full and may not have sufficient equity to purchase another property. 

Additional information Information for interest only mortgage customers

The Financial Conduct Authority (FCA) has published its research into consumers’ ability to repay their interest-only mortgages when they mature. The findings show that many people should be in a good position to repay their mortgage when it is due for repayment.

However some borrowers, including those whose mortgage is due to be repaid before 2020, will need to take control of their mortgage repayment planning now. To that end the FCA, the Council of Mortgage Lenders (CML) and the Building Societies Association (BSA) are working together to ensure lenders contact their borrowers in order to prompt them into checking their plan for repayment is on track and considering the options available to them.

The FCA believes that with careful planning, consideration and engagement with their lender, many interest only borrowers - even those with loans maturing by 2020 - should be able to find a viable way to pay off their mortgage if they take control now.

If you have any concerns or questions please contact us using the details shown on the bottom of this page.

Frequently asked questions More about interest only mortgages
Protecting your money

We are a member of the Financial Services Compensation Scheme (FSCS). The Scheme can pay compensation to customers if they are eligible and the Bank is unable to pay claims against it. Compensation limits for Mortgage advice and arranging (for business conducted on or after 31 October 2004) - maximum £50,000 i.e. 100% of first £50,000 per person. Further information is available here  ( 650K PDF) or visit


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