Last reviewed: June 2026
TL;DR- A part-and-part mortgage divides the loan: one portion is on a repayment basis (capital and interest paid monthly), the other on interest only (capital due at term end).
- Monthly payments are lower than a full repayment mortgage on the same loan but higher than full interest only.
- The interest only portion requires a credible repayment vehicle - the repayment vehicle requirement applies to that portion even though the rest of the loan is on repayment.
- Not all lenders offer part-and-part mortgages - availability is more restricted than for pure repayment or interest only products.
How a Part-and-Part Mortgage Works
A part-and-part mortgage takes a single mortgage and splits it into two portions with different repayment structures. The repayment portion is paid down each month with both capital and interest, in the same way as a standard repayment mortgage. The interest only portion requires only the interest to be paid monthly - the capital on that portion is due as a lump sum at the end of the mortgage term and must be covered by a repayment vehicle.
For example: a £300,000 mortgage split 50/50 means £150,000 on repayment (reducing each month) and £150,000 on interest only (staying constant throughout). Monthly payments are between what a £300,000 full repayment and £300,000 full interest only would cost. At the end of the term, £150,000 is still outstanding from the interest only portion and must be repaid.
Why Borrowers Use Part-and-Part
Part-and-part mortgages are used by borrowers who: want lower monthly payments than a full repayment mortgage but want some capital to be repaid progressively; have a credible repayment vehicle for a portion of the loan (for example, an investment ISA or pension) but not the full amount; or are managing cash flow while expecting future income to be higher. It is also used by borrowers moving from a full interest only mortgage to a repayment structure gradually, or by older borrowers who want to repay part of the loan while covering the rest through equity release or property sale.
Repayment Vehicle Requirement
The interest only portion still requires a credible repayment vehicle, as per FCA MCOB 11 rules. Lenders must assess the repayment vehicle for the interest only portion even though the rest of the loan is on repayment. A borrower who has an investment ISA projected to cover £100,000 could use that as the repayment vehicle for the interest only portion, with the rest on repayment. The vehicle must be credible and evidenced - the standard interest only repayment vehicle rules apply to the relevant portion.
Lender Availability
Part-and-part mortgages are offered by fewer lenders than pure repayment or interest only products. Some lenders structure part-and-part as two separate loans on the same property (two charges); others structure it as a single loan with split sub-accounts. The availability of part-and-part and the specific LTV, income and repayment vehicle requirements should be checked with a whole-of-market broker for current lender availability.
Frequently Asked Questions
Can I change the split between repayment and interest only during the mortgage term?
This depends on the lender and the product structure. Some lenders allow the split to be adjusted at the point of a product transfer or remortgage. Others fix the split at outset. Where the split is fixed, changing it requires a remortgage. Borrowers who want flexibility to adjust the split over time should check the product terms carefully before committing.
Does a part-and-part mortgage affect my affordability assessment?
Lenders assess affordability for a part-and-part mortgage on a repayment basis for the whole loan - the same FCA requirement that applies to interest only mortgages. The borrower must demonstrate affordability of a full repayment mortgage on the total loan amount, even though the actual payment is lower. This ensures the borrower could service the full loan if the interest only portion needed to be converted to repayment.
Can I use part-and-part for a buy-to-let mortgage?
Some BTL lenders offer part-and-part structures, though they are less common in the BTL market than interest only (which dominates buy-to-let). BTL part-and-part structures must meet the same BTL affordability (rental coverage) criteria. The repayment vehicle for the interest only portion must be credible in the same way as for a residential part-and-part.
If my repayment vehicle falls short at term end, what happens to the interest only portion?
If the repayment vehicle does not cover the outstanding interest only balance at the end of the term, the borrower must make up the shortfall from other resources. If they cannot, the lender has the right to pursue the outstanding debt, which could ultimately result in repossession if no resolution is reached. The FCA requires lenders to contact borrowers well in advance of maturity and explore options before enforcement action is taken.
