What Are Flexible Mortgages?
Hot Topics
- I Am Self-Employed. Can I Get a Mortgage?
- Whilst many high street lenders will exclude them our mortgage partners specialise in finding the best deals around for the self employed
- Where Can I Buy a Mortgage?
- Many, but not all financial services companies offer mortgages. If you are looking for a mortgage the traditional approach is to speak to you bank or a building society. However, you are most likely to find the cheapest deals by speaking to a Mortgage Broker.
- What Are Redemption Penalties?
- Redemption penalties are your lender’s way of getting extra money out of you when you decide to cancel your mortgage agreement early.
- Refinance Mortgage
- What is a Refinance Mortgage?
- What if I have mortgage arrears?
- If you have mortgage payments that have not been made by the due date in accordance with the mortgage deeds, you will have gained a bad credit history on your credit report. This may hinder you when trying to obtain further credit such as a credit card, loan, or another mortgage.
Generally, people rebroke their mortgage deal once every five or six years. They also may change their mortgage lender at the end of a discounted or fixed period. Chances are in that in the time between their last remortgage, the mortgage market will have changed a great deal.
Today’s mortgage market is also a great deal more competitive than ever before. Remortgaging is in vogue because borrowers have begun to realise that they could change their lender if they wanted to. This has allowed a ‘Bargin hunter’ mentality within the uk mortgage market with borrowers looking for the ‘best offer’ at every opportunity. In recent years many new types of mortgage and many new variations on existing types have released in to the market place the most prominent addition in recent years to the mortgage market was the flexible mortgage.
What makes a mortgage a ‘flexible’ mortgage, with so many products available how do can you recognise a flexible mortgage?
Overpaying
The defining benefit of a flexible mortgage is the ability to overpay your loan back faster than the normal repayments would allow. This benefit can save you a lot of money as you can reduce your interest charges on the loan. You should be allowed to overpay at any time, and any amount, and by lump sum or regularly. This helps to reduce the total interest owing, and you can pay the loan off early.
Interest Charges
On a flexible mortgage, interest should be calculated daily. This will allow you to get the maximum overpayment benefit immediately rather than having to wait for a for the interest to be calculated annually.
Underpaying
A truly flexible mortgage will allow you to underpay if you need to, usually this benefit is only allowed after you have overpaid enough to cover the difference between your normal payment and your underpayment.
Payment Holidays
You should be able to take a payment holiday, maybe for a couple of months or over Christmas. usually this benefit is only allowed after you have overpaid enough to cover the difference between your normal payment and your underpayment.
No Redemption fees
A flexible mortgages should not have redemption fees at any time, so you are free to pay off large chunks of your mortgage or move on without penalty.
Reborrowing
Finally, you should be able to borrow back money that you have overpaid should you need to.
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