A large amount of mortgage schemes penalise you, somewhat unfairly, if you make regular overpayments. This can make life difficult if you do not earn at a regular rate if, for example, you are self employed or bonuses make up a large part of your pay check. However, a Flexible Mortgage can be a source of much needed respite for many people, particularly in these troubling financial times. A Flexible Mortgage is designed to fit around your life style, allowing you to overpay and underpay as it suits you. Several other options are offered depending upon the lender.
It is designed for people who will primarily overpay, so might not be the best option for people who are worried about redundancy. If you do regularly overpay, you will not be penalised, as there are usually no early repayment charges. In a Flexible Mortgage, the interest will be calculated straight away, meaning you will receive full benefit from your overpayments.
Making overpayments is also heavily rewarded. It allows you to make underpayments when in troubling financial circumstances, allow you to stop payments for a short while and sometimes even borrow back a lump sum, depending on your past over payments. If you are planning on having children, a payment holiday can be ideal when having a child. The lump sum option can be a great asset to have in case of unpredictable emergencies.
However, this type of mortgage can be complicated, so a good mortgage broker is a definite must have.
