Interest only mortgage With an interest only mortgage, you pay just the interest on the borrowed money each month. At the end of the mortgage term, you still need to pay back the original amount borrowed. So, you’ll need a plan for how to pay this back at the end of the term. Most owner-occupiers take out repayment mortgages. Their thinking is that they want to have the mortgage paid off in full by the time they retire. So, they opt to pay this off gradually over time. This is the default for most property owners and it’s favoured by banks.
