Openwork launch campaign to help move from interest-only
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Openwork is launching a campaign encouraging interest-only borrowers to switch to a capital and repayment loan.
The UK’s third-largest mortgage introducer is trying to ensure borrowers are not penalised for switching to a repayment mortgage.
Openwork clients will pay no administration fee when switching loans with lenders including Nationwide, Halifax, C&G, Scottish Widows, Lloyds TSB Scotland and Woolwich.
To help advisers highlight the move to clients, Openwork is offering pre-approved template letters outlining the consequences of not having a repayment vehicle in place and the benefits of repayment loans.
Paul Shearman, mortgage, protection and general insurance proposition director, Openwork, says: “At least 20% of UK borrowers have an interest-only mortgage and FSA figures show the vast majority of them do not have a suitable repayment vehicle in place to pay the total outstanding debt. That is a huge concern to borrowers and lenders alike.
“We believe this campaign is a win-win for all concerned. It helps de-risk banks’ loan portfolios while confirming clients are on track - or helping them to get on track – to repay their loan in full. For mortgage advisers, it provides a great opportunity to re-engage with clients, while for Openwork’s full financial planners it provides a number of potential investment opportunities.”
