Interest-only mortgages have received strong criticism lately and some say the entire product range could eventually be withdrawn, writes Tony Booth.

In the meantime, investors may find these products become less favourable than alternatives, because lenders are starting to amend terms and conditions to discourage all but the most determined.

The popularity of the interest-only mortgage amongst property investors has been growing ever since it was introduced.

The annual yield advantages are easy to calculate, given that these loans reduce the monthly cost of mortgage repayments and make a buy-to-let investment more affordable and rental income more profitable.

Many are unconcerned that an interest-only loan will never pay off any of the capital, because they assume the property will always rise in value over time.