You are here: Home - First Time Buyers -

Guide to flexible mortgages

0
Written by:
16/01/2017
A truly flexible mortgage allows you to do the following:
Guide to flexible mortgages

 

  • Overpay
  • Underpay
  • Take payment holidays
  • Borrow back overpayments
  • Not apply any Early Repayment Charges
  • Calculate your Interest daily

 

Could you save money with a flexible mortgage?

 

The best thing you can do with a flexible mortgage is make overpayments. This will allow you to pay off your mortgage early and potentially save many thousands of pounds in interest payments.

With interest rates currently at a record low, many thousands of flexible mortgage borrowers have taken the opportunity to overpay and reduce their mortgage debt in recent years. But the beauty of a flexible mortgage is that it then allows you to borrow back those overpayments if you need to, or you could decide to stop paying your mortgage for a month or two, maybe when expenditure is at a peak.

To be really flexible, a mortgage should allow you to leave it without paying an early repayment charge (ERC), but as many flexible mortgages these days come as fixed rates or with discounts, this is not always the case.

Finally, it is important that interest is calculated daily, so that any overpayment is taken off your mortgage as soon as you pay it.

 

While some lenders advertise fully flexible mortgages, thousands of other mortgage deals come with flexible features these days; the most common being the facility to overpay.

 

Some will only allow you to overpay a maximum figure per month (eg £500), while some will let you pay off a maximum percentage of the mortgage amount per year (eg 10%).

 

Pros and cons of flexible mortgages

 

Flexible mortgages put you in charge of your finances, and offer the potential to save a huge amount of money if used properly. They can be ideal for anyone with a fluctuating income, such as the self-employed, or people who work on commission.

Tagged:

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Sorry. No data so far.

Guide to borrowing past retirement age

As an older borrower, you may be concerned that a lender will not offer you a mortgage pas...

Mortgage market biased against homeowners

Buy-to-let property investors are unfairly favoured in the mortgage market, an independent...

Should buy-to-let investors ‘go Dutch’?

The Netherlands is revealed as Europe’s top buy-to-let property hotspot

Private sector tenants in poverty double in decade

The number of private rented sector tenants in poverty has doubled in the last decade from...

Large mortgage broker firm launches with fees of over 1%

An insurance firm has launched a mortgage advice service

Second steppers targeting detached properties

Those living in their first home are increasingly looking to reduce the steps to their lon...

Mortgage Calculators

Save money now!

See how much you could potentially save by remortgaging to a different product

How much can you borrow?

A calculator designed to help you understand how much you can borrow towards your property
Read previous post:
2257556-shutterstock-121041238
Guide to fixed-rate mortgages

Fixed-rate mortgages are fairly popular in the UK. As the name suggests, they allow you to fix the rate of...

Close