Repaying your Mortgage

Split Mortgage
Most lenders allow you to combine both repayment methods. This would be beneficial if you already have an endowment mortgage for say £50,000 and are looking to move and take on a new mortgage of £150,000. You may want to keep your existing endowment until the policy matures, but taking the whole of the new mortgage on capital and interest would mean a much larger and unaffordable mortgage payment.

This may make the cost a little high, so you could chose to borrow the additional amount on a repayment basis and keep the £50,000 on an interest only basis.

In some cases the lender maybe happy if there is not an investment vehicle to support the interest only portion of the mortgage, this maybe suitable if you wish to use other funds to repay the mortgage at a later date. For instance, from the sale proceeds from the property in the future.
Don't forget though that most investment policies are not guaranteed to accumulate enough money to pay off the interest only portion. You may find at the end of the term you will need to make up a shortfall