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Flexible Mortgage
Flexible Mortgage. The term flexible when used in the context of a mortgage can mean a variety of things. In recent years lenders have introduced flexible mortgages into the market that allow you to vary your monthly repayments. Generally speaking you have the option of overpaying underpaying or even taking a payment holiday. The obvious advantage of overpaying for example is your outstanding loan will reduce more quickly. And this will cut your monthly payments in the long run. Conversely your financial circumstances may temporarily change and you might have the need to pay less. The advantage of a flexible mortgage is you wont be penalised in these circumstances. But if you wish to make an underpayment youll only be allowed to do so as long as overpayments have previously been made. While a dozen banks building societies and insurance companies currently offer these types of loans its worth noting that terms and conditions will vary from lender to lender. From a practical standpoint the flexible mortgage can offer a combination home loan and current account rolled into one. So if you take out say a £75000 mortgage and then you win £10000 on the premium bonds you can simply without penalty reduce the size of your mortgage. Flexible mortgages often come with cheque books attached. So conversely if you suddenly need an extra £5000 youll be able to write a cheque and in the process increase the overall size of your homeloan to £80000. A key point to consider is that if the mortgage is truly flexible there should be no early repayment charges attached it. ©Moneyextra.com 2009-02-17 00:00:00 © Moneyextra.com
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