Paying off just the interest gives you more income each month. Yes, you need to find the money to repay the mortgage in the distant future when you’re unable to extend the loan term any further – but you’ll get a major helping hand from inflation. Inflation is an extremely powerful force, but it’s easy to miss because, year to year, it’s barely noticeable. Over a 25-year mortgage term though, its effect is huge. Let’s say you borrow £75,000 today (to buy a house worth £100,000) and pay off nothing but the interest. Assuming annual inflation of just 2%, its “real value” by the time you pay it
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