Coventry Building Society will no longer offer interest-only residential mortgages for new lending.

From 3 December, Coventry Building Society will only offer interest-only mortgages for buy-to-let loans.

Existing borrowers at Coventry Building Society on interest-only will not be able to increase their borrowing on an interest-only basis but they will be able to port their existing mortgage.

The FSA established as part of the final publication of the Mortgage Market Review that ultimate responsibility for repaying the capital at the end of an interest-only term rested with the borrower, not the lender.

The FSA will publish a thematic review on the issues facing existing interest-only borrowers in early 2013.

Nationwide revealed it was pulling out of interest-only in October this year – it also took the line that interest-only has become a niche product, representing less than 3 per cent of the applications that it received.

If you have an interest only mortgage and would like a review to ensure that you have suitable repayment vehicles in place and they are on target or you would like to discuss transferring it to a Capital & Interest basis. Contact us on 01489 580020 or email us at  info@parkgate.net

 

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