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A Flexible Mortgage allows you to repay capital early, take back some cash you have paid in and postpone payments. Some are run as substitutes for current and savings accounts, so all your money is working to minimise interest on
mortgage.
If you are looking for flexibility in
current mortgage market, there are two important facts to bear in mind. First,
majority of flexible mortgages tend to charge higher rates than those available on more conventional mortgage deals.
Secondly, there is little difference between mortgages marketed as fully flexible and conventional mortgages which are offering an increasing number of flexible features. So unless you want to use
full range of features offered by a flexible mortgage, you may find
level of flexibility you are after on a conventional deal at a much better rate.
Generally you can choose to have a variable or discounted rate or sometimes a combination a variable and fixed rate. By choosing to take part of your mortgage at
fixed rate allows you
flexibility to make overpayments to
variable rate option during
fixed rate period without any penalties.
A truly flexible mortgage should have all of
following options:
Interest is calculated at least monthly, preferably daily.
Overpayments are allowed penalty free. You can take payment holidays. You can make underpayments.
You can draw down any unused facility.
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