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Whats An Endowment Mortgage?

April 26, 2017endowment mortgage

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Whats An Endowment Mortgage?

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This is an interest only mortgage supported by an endowment policy. During the term of the mortgage only the interest on the mortgage is paid to the lender. At the same time premiums are paid into an endowment policy which is designed to mature at the end of the mortgage term. The proceeds are designed to repay the mortgage debt although this is never guaranteed. An endowment policy can also include life assurance which will repay the mortgage debt in the case of the death of the policyholder within the agreed term. Consider the risks of an endowment mortgage policy carefully before taking one out.