Interest-only mortgages

Information for new and existing customers.

What do I need to remember?


With an interest-only mortgage, your monthly payment pays only the interest charges on your loan – you don’t pay off any of the loan amount and won’t be reducing the loan.

Mortgage graph

This means that although your monthly payments will be less than if you had a repayment mortgage at the end of the mortgage you’ll still owe the amount you borrowed.The total cost of an interest-only mortgage will be higher because you will be paying interest on the full loan amount  throughout the mortgage term. 

Interest- only mortgages are only available when the amount of loan is less than 75% of our latest valuation of the property. (Please note these limits change from time to time but were correct at January 2016.)

With an interest-only mortgage, you will need to know from the start how you are going to find a lump sum to repay the loan at the end of the mortgage term. When you apply, we’ll ask you to show us the repayment plan(s) that should provide enough money to repay everything you owe by the end of the mortgage term.

From time to time, we may ask you to show us that your repayment plan(s) remains on track to repay the mortgage.

What type of repayment plans can I use?

This table sets out the repayment plans we currently accept which may change in the future.

Acceptable types Information you must give us Our assessment of acceptable values

Endowment Policies (UK)

Copy of latest projection statement dated within last 12 months. 

Endowment companies will present three growth rates. We allow up to 100% of the projected amount using the middle figures. 

Stock and Shares (UK)

Copy of share certificates, nominee account statement or confirmation from a recognised broker containing evidence of share holdings and their valuation 

We’ll accept up to 80% of the latest valuation of the stocks and shares, ISA, OEIC or investment bond (provided that the latest value if greater than £50,000)

Stocks and Shares (UK)

Copy of latest statement dated within the last 12 months

As above

Unit trusts, open-ended investment companies (UK)

Copy of latest statement dated within the last 12 months  

As above

Investment Bonds (UK)

Copy of latest statement dated within the last 12 months  

As above

Pension (UK)

Copy of latest statement dated within last 12 months.

To back an interest-only mortgage, we can use a maximum of 25% of the latest value provided that this is greater than £1m 

Sale of Second Home/Buy to Let (UK)

Property details, confirmation of ownership, evidence of the amount of any mortgage debt

We’ll check the ownership of the property and assess its value. We’ll deduct any amount you owe that’s secured against the property and allow you to use up to 80% of the amount left over (provided that this is over £50,000)


As with any investment there is a risk that it will be insufficient to repay your outstanding mortgage at the end of the term and could mean your property needs to be sold to repay the mortgage. We will not provide advice on your investment plan and strongly recommend that you take independent advice.

Information for existing customers

How do I let you know the way I'll repay the amount borrowed?

All you need to do is complete our  Declaration of Intent Form (PDF) and provide supporting evidence to let us know your repayment plan. For details of the evidence required please see above. Once complete, send the Declaration of Intent along with photocopies of your most recent statements/projections to:

PO Box 373
LS14 9GQ

If you think your repayment plan isn't going to cover everything you'll owe at the end of the mortgage term, call 0345 835 3389.

Or if you've recently changed your repayment plan and need to update us, just follow the same Declaration of Intent process above.

Keeping on track with your repayment plan

Staying on top of your finances throughout the life of your mortgage will help you keep on track or even reach your goal sooner. While it’s your responsibility to keep an eye on your repayment plan, we will check with you that your plan remains on track and support you as far as possible. From time to time, we may ask you to show us that your repayment plan(s) remains on track to repay the mortgage. If we think your plan may not be enough to repay everything you owe by the end of the term, we’ll try to contact you to discuss other arrangements. These may include transferring part, or all, of your loan to a repayment mortgage. 

What if I don't have a plan in place?

If you don’t have a plan in place it’s important that you act now. Please contact us on 0345 835 3389 as soon as possible so we can discuss the options and help you put a plan in place. Lines are open 8:30am - 7pm Monday to Friday and 8:30am - 1pm on Saturdays.

These are some of the repayment plan options available:

  • Switching all of your mortgage to repayment basis - this will mean that your monthly payment will increase but your full mortgage will be repaid at the end of the term
  • Switching part of your mortgage to a repayment basis
  • Pay into an investment plan which can be used to pay off the capital at the end of the term
  • Make lump sum overpayments or set up regular overpayments but first check your mortgage offer to see if an Early Repayment Charge would apply. 

Worried your repayment plan isn't sufficient?

Even if you’re a few years away from the mortgage end date – the longer you leave it the fewer options you’ll have to get back on track so it’s important you contact us as soon as possible. If you have a plan in a place but you don't feel it'll cover the amount owed at the end of your mortgage, please call 0345 835 3389 and we'll be able to go through the options available to you.

Worried about paying your mortgage?

If you're worried about keeping up your mortgage repayments, the best thing to do is speak to us. We can talk through the various options available and we'll try as best we can to resolve the issue.

Find out more about what you can do if you're facing financial difficulty.

Who can help me work out a repayment plan?

As your mortgage lender, we’re here to help and explore which options are right for you. If none are suitable, we’ll help you take the next step by putting you in touch with Age Partnership, the over 50s’ finance experts. Their experts will give you honest, impartial advice, explore your options and work with you to put a plan in place to suit your needs. And as a TSB mortgage customer, you’ll receive a free initial discussion.

Where else can I find support?

From advice on repayment plans to remortgaging, you can get free, unbiased information on interest-only mortgages via the Money Advice Service website.

Want to speak to someone about your mortgage?
If you'd like to speak to someone who can review your mortgage, please call 0800 056 1088. Lines are open from 8am - 8pm Monday to Friday and 9am - 2pm on Saturdays.

How to apply

Request a call back from your local Mortgage Adviser who can arrange a convenient time to discuss your mortgage needs face to face, by phone or via video

Find out what information you’ll need to have to hand

To talk to us about a new mortgage, call us on
0800 056 1088

Lines are open Monday to Friday 8am to 8pm and 9am to 2pm on Saturday.

Mortgage calculator

Get an indication of how much your mortgage repayments will be.


Register for mobile banking

We’re open anytime and anywhere. Take care of your day-to-day banking when you need to.

Set up mobile banking

logging in?

Follow our step-by-step tutorial to get back online from the safety of your home.

View tutorial

Need to visit us?
Visit our FAQs

If you need help with something specific, let us know what it relates to or search a topic.

Go to help page