Repayment mortgages are the most traditional and widely used way of returning borrowed money to mortgage lenders. Simple and easy to understand, it is generally accepted that they also offer the most risk-free route to clearing your mortgage debt.

Each month you will make a single repayment to the mortgage lender. Part of it will be an interest charge on the outstanding balance of the mortgage and the rest of it will go towards reducing your debt.

Unless interest rates change or your introductory offer period ends, repayments will stay at the same amount each month. If the interest rate payable on your mortgage changes for some reason, then the cost of your repayments is altered so that the loan is still repaid at the end of the specified term.

In the early years of a repayment mortgage, the bulk of the monthly repayment is taken up with paying interest on your debt to the lender. Only a small portion of the sum you pay out will be used to reduce the amount of capital that you owe. As your debt slowly starts to fall, so too does the amount of interest you will owe the lender each month. Smaller interest charges mean that more of your loan is used to repay the capital, reducing the outstanding balance faster and faster as time goes on.