Request a call back from a Mortgage Expert who can arrange a convenient time to discuss your mortgage needs via video, telephone or face to face.
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.
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 the loan is less than 75% of our latest valuation of the property (or less than 60% if your repayment plan is to sell your home, with a further 15% available on repayment). Please note: these limits change from time to time but were correct at November 2023.
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.
All evidence must be given on letter headed paper, from your repayment plan provider.
| Acceptable types | Information you must give us | Our assessment of acceptable values |
|---|---|---|
Endowment Policies (UK) |
Copy of latest projection statement dated within the last 12 months. |
Endowment companies will present three growth rates. We allow up to 100% of the projected amount using the middle figure. |
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 ISA (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 projection statement dated within the last 12 months. |
To back an interest-only mortgage, we can use a maximum of 60% (maximum of 80% for final salary schemes) of the projected tax-free lump sum, provided that this is greater than £100,000. |
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) |
Sale of Second Home/Buy to Let not yet purchased (UK) |
Property details. Acting solicitor to confirm intended ownership and details of any loans to be secured against this property. |
We’ll confirm the intended ownership and assess its value. We’ll deduct any amount you’ll owe that’ll be secured against the property and allow you to use up to 80% of the amount left over (provided that this is over £50,000) |
Sale of the security property (UK) |
A signed declaration. This form will be provided by TSB for you to sign. |
We’ll assess the property value. We’ll deduct the amount you owe that’s secured against the property and allow you to use the sale of your home as a repayment plan where the equity within the property is over £300,000. |
As with any investment, there is a risk that it may not cover your outstanding mortgage balance at the end of its term. This means you may need to sell your property to repay your mortgage.
We cannot provide advice on your investment plan. If you need or want advice, please speak to an Independent Financial Adviser.
If your repayment plan is the sale of your home, remember that the value of your home can go down as well as up. This could affect your plans – for example the type, location, and cost of a home you might want to downsize to.
Information for existing customers
How do I let you know the way I'll repay the amount borrowed?
Use the online form
Screen reader users are advised to use an alternative channel.
You can tell us how you plan to repay your interest-only mortgage using our online form.
Complete the form below to upload your repayment plan evidence. For details of the evidence required please see the repayment plan evidence table above. You'll need your TSB mortgage account number, which can be found on your mortgage statement or other mortgage related letters.
Adobe digital forms
We use Adobe Sign for this kind of request. Adobe will pass the information you provide to us in a secure manner and won't process it in any other way. Information on how we use your data can be found in our Data Privacy Notice.
Other ways you can tell us how you plan to repay your interest-only mortgage
By post
Complete our Declaration of Intent Form (PDF) and provide supporting evidence to let us know about your repayment plan. For details of the evidence required please see the repayment plan evidence table above. Once complete, send the Declaration of Intent along with photocopies of your most recent statements/projections, dated within the last 12 months to:
Mortgages
TSB Bank PLC
PO Box 453
Mitcheldean
GL14 9LR
If you have a repayment plan in place but are unsure if it will cover everything you'll owe at the end of the mortgage term, please call 0345 835 3389 so we can discuss the options and help you put a plan in place.
How long it takes
Once your completed forms and evidence have been received and reviewed, we will let you know if your evidence has been accepted or if we need more information. We normally respond within 30 working days if possible, however there may be occasions we don't meet these timescales.
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 MoneyHelper 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.
Mortgage calculator
Get an indication of how much your mortgage repayments will be.
How to apply
Request a call back
How to apply
Call us
8am-8pm Monday to Friday 9am-2pm Saturday
