Investment Vehicles
In order to raise money to pay off the mortgage capital at the end of the term on an interest only mortgage you will need to invest every month in an investment vehicle. Investment vehicles are basically policies used by financial institutions, mainly insurance companies, to build up money. A borrowers money is invested in certain ways in order to (hopefully) make more money by receiving interest on the investment. The money is usually invested in stocks and shares. There are several ways of investing for the mortgage capital repayment at the end of the mortgage term.
Here are the three main current investment vehicles explained: