Offset Mortgage, Flexible Mortgages, Overpayments
What is a flexible mortgage?
Flexible mortgages are mortgages were you can off set the balance with your savings; you can also make overpayments with out restrictions. Most lenders will limit you to a maximum of 10%. But with flexible mortgages you can take the balance down to £1.00.
Who can use flexible mortgages?
Flexible mortgages are available to most people, however if you have a low credit score it is unlikely that you will be able to access this type of scheme.
What are the benefits of flexible mortgages?
The benefits of this type of mortgage is that you can dip into and add to at any time, you may receive lump sum payments throughout the year, you may be looking to do home improvements later in the year and require a draw down facility. You can also use them for staged payments.
You can draw down money that has been overpaid if times are tight and you need to raise extra capital.
What are the disadvantages of flexible mortgages?
The main draw backs to flexible mortgages are that the rates are not as competitive as other lenders and the rate is normally variable as it will be linked to the lenders standard variable rate. If rates were to start rising you could lose all of what you had saved.
How much do flexible mortgages cost?
Flexible mortgages are the same price to set up as a standard mortgage, so you need to take into account lenders arrangement fees, valuation and legal costs. If you do not want to pay fees then maybe a fees free mortgage would be better a better option.
What’s the best flexible mortgage product?
As mortgage brokers we can advise on which offset mortgage would be best for your situation, after completing a fact find with you. The main options to be considered with offset mortgages are overpayment, underpayment and payment holiday options. Some lenders will not let you have a payment holiday unless you have already made overpayments others will limit you to a maximum of 3 in one year.
Who provides flexible mortgages?
The offset mortgage market is small, only a handful of lenders offer what can be considered fully flexible options. for more information and quotes for offset mortgages please contact us.
