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Other repayment vehicles for interest-only mortgages (Investment Trust…
Other repayment vehicles for interest-only mortgages
ISA
Basic features
UK Res.
Min 18+ (16+ cash ISA)
Single ISA only
Tax free
Cash, stocks & shares, innovative finance
Annual limit
Transfer ISAs
Investment
Cash
Stock and shares
Innovative finance (peer to peer)
Types
Standard ISA
Stocks and shares ISA
Shares
Unit trusts/OEICs
Investment Trusts
Life assurance
GILTS
Corporate bonds
Cash ISA
Help to Buy ISA
16+ age
PV 450k London, 250k elsewhere
Deposits - £1200 mth 1, £1-£200 after
25% bonus up 3000k per person paid on prop completion
Min 400 bonus min save £1600
Junior ISA
Lifetime ISA
18-39 age
Deposts - £4000 per year
25% annual contribution bonus up age 50
Access - 60 years or first property. Taken prior 25% penalty on amount withdrawn.
PV 450k bonus used for deposit
Unit Trusts/OEIC
Unit trusts
Legal basis
Trust deed
Fund mandate
Assets separate
Key roles
Trustee
Hold funds
Fund manager
Manages fund
Structure
No. units represent value of asset
Ability to create units
Management
Actively managed
Borrowing
Very short term
OEIC
Legal basis
Company
Clear investment mandate
Assets separate
Key roles
Depositary
Holds funds
Authorised corporate director
Manages fund
Structure
Issues shares
Ability to issue more shares
Management
Actively managed
Very short term
Investment Trust
Legal basis
Public limited company
Structure
Closed-ended
Stocks and Shares
Value
Net asset value
Market value
Gearing
Borrowing to invest
Pension
Contribution tax relief limits
£3600/ individuals earned income
Annual allowance
40k
Tapered allowance
£1 for £2 above 150k income
MPAA
FAD or UPFLS
4k limit on DC contributions