0 used to describe a loan for which you only have to pay interest, so that you are not paying back the money borrowed:
interest-only mortgages
No help is provided for capital repayments or, in the case of interest-only mortgages, with the investment vehicles such as endowment policies.
At present that family makes interest-only payments of £49 a week.
First, a family consisting of husband, wife and two children with a £16,000 mortgage, at present makes interest-only payments of £26 a week.
That was one way of getting money because elderly people could cope with an interest-only loan, but it has now been stopped.
One way was through the building societies but building societies are now prevented from making interest-only loans.
In fact, those mortgages are a bundling of two things—an interest-only mortgage and, behind it, a with-profits endowment life policy.
They include interest-only mortgages, home income plans, home reversion schemes, investment bond schemes and roll-up loans.
As well as the usual personal loans and mortgage advances, there has been growth of "maturity lending", which involves interest-only payments.
