A growing number of UK homeowners may be eligible for a short-term reduction in their monthly mortgage payments, offering temporary relief amid the ongoing cost of living crisis. A financial strategy shared by KIS Finance reveals a way for eligible borrowers to cut payments significantly—without damaging their credit scores.
With mortgage costs rising faster than wage growth, many households face growing financial pressure. This move could provide much-needed breathing space, especially for families with fixed expenses and limited financial flexibility.
Interest-Only Switch Could Cut Costs by Hundreds of Pounds
According to Holly Andrews, Managing Director at KIS Finance, borrowers may be able to switch to interest-only repayments for a six-month period—drastically reducing their monthly mortgage bills. The strategy is simple but often overlooked.
For a mortgage of £200,000 at a 5% interest rate, this shift would reduce monthly payments by approximately £500, as the borrower would be covering only the interest charges rather than repaying part of the principal. “Most people don’t realise how significant the savings can be,” said Andrews.
The change can be arranged directly with the lender, and crucially, the discussion does not affect the borrower’s credit score, despite widespread fears to the contrary. “You can call your bank or lender to discuss this option right away,” Andrews added. “Importantly, this call won’t impact your credit score.”
This measure is designed to function as a short-term buffer and is not a permanent solution. Homeowners are free to revert to their original repayment terms within the six-month window.
Borrowers Advised to Explore Options Cautiously
Although the interest-only switch presents immediate financial relief, it does not reduce the overall mortgage balance, which can affect long-term repayment planning. Andrews advises that the approach be used only as a temporary measure, best suited for those facing short-term income disruption.
Other strategies available to borrowers include extending the mortgage term or requesting a payment deferral, both of which can alter monthly costs depending on the individual’s financial outlook. Each method comes with distinct considerations and potential long-term implications.
Data from the Office for National Statistics shows mortgage repayments are outpacing income growth, increasing financial pressure on working households. In this context, flexible arrangements may become increasingly important.
Borrowers are encouraged to communicate early with their lenders and seek professional advice where needed. “Anyone worried about their mortgage should contact their lender,” Andrews concluded, “and keep in mind that these conversations won’t harm their credit score.”
