Guide to Flexible Mortgages

Written by John Mussi


Outlined below is a useful guide to flexible mortgages. Flexible mortgages are also known as Australian Mortgages because they usually feature something which is common in Australia - interest recalculation on a daily basis.

Daily interest rate calculation means thatrepparttar amount you owe falls each month as a little more capital is paid off with each mortgage payment. Most flexible mortgages now offer daily calculation of interest, so changes torepparttar 143940 outstanding balance are taken into account immediately.

The flexible mortgage was originally designed to help homeowners take a more pro-active role in managing their debt. Since their inception they have increased dramatically in popularity.

Flexible mortgages allow you to tailor your mortgage to suit your lifestyle. A flexible mortgage allows you to make additional or lump sum payments in excess of your scheduled amount, enabling you to pay off your mortgage early. By reducingrepparttar 143941 capital amount of your mortgage in this way, you are also reducing your monthly interest payments. You may take this money back at any stage or use it to take a repayment "holiday".

A flexible mortgage typically allows you to increase and reduce payments. This flexibility allows you to match your income patterns to your out-goings. If you repay extra each month you can reduce you mortgage balance and interest charged resulting in substantial savings being made.

Flexible mortgages are loans which allow you to increase or reducerepparttar 143942 size of your repayments within certain limits. This may help you cope with changes in your income or spending, and reduce your outstanding commitments without penalty.

Each lender has a different idea of what makes a mortgage flexible choosing to combine all or some of a set of flexible features. Flexible features include regular overpayments, lump-sum overpayments, lump-sum withdrawals and payment holidays. Customers may also be able to make payments weekly.

Flexible mortgages offerrepparttar 143943 safety net of being able to take occasional payment holidays when financial times get tough. Butrepparttar 143944 payment holiday safeguards lenders put in place to ensure borrowers are generally prevented from falling into arrears or negative equity vary considerably from lender to lender. So it is vital to checkrepparttar 143945 terms and conditions of each loan. A large number of lenders allow payment holidays whererepparttar 143946 borrower is drawing back on a reserve limit agreed atrepparttar 143947 time ofrepparttar 143948 mortgage application.

Flexible Mortgage Tips

Written by John Mussi


Outlined below are some useful flexible mortgage tips. The most prominent addition in recent years torepparttar mortgage industry has beenrepparttar 143939 flexible mortgage. Asrepparttar 143940 name implies, it offers greater flexibility thanrepparttar 143941 traditional mortgage.

Flexible mortgages are fast becomingrepparttar 143942 most popular way of taking out a new mortgage. The reason for this is that this type of mortgage allows you to take control of your mortgage and notrepparttar 143943 other way round.

Unlike some traditional mortgage loans that still charge mortgage interest on an annual basis, fully flexible mortgages calculate interest daily, which means that any overpayments you make are immediately credited against your loan, thus reducing your interest costs. It means you getrepparttar 143944 maximum benefit from your overpayment benefits immediately, since you don't need to wait for an annual interest calculation.

Many self-employed people whose income varies from one month torepparttar 143945 next find flexible mortgages particularly helpful. They can make overpayments when earnings are atrepparttar 143946 annual peak and cut payments when earnings fall again.

Some flexible mortgages allow you to withdraw sums you have overpaid into your mortgage account for emergencies.

A flexible mortgage allows you to make additional or lump sum payments in excess of your scheduled amount, enabling you to pay off your mortgage early. By reducingrepparttar 143947 capital amount of your mortgage in this way, you are also reducing your monthly interest payments. You may take this money back at any stage or use it to take a repayment "holiday".

This gives yourepparttar 143948 flexibility to manage your mortgage payments to suit your cash flow needs as your circumstances change. These Flexible Mortgages allow 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 onrepparttar 143949 mortgage.

Some mortgage lenders offer a current account arrangement with their flexible mortgages. You can pay your monthly salary intorepparttar 143950 account thereby reducingrepparttar 143951 amount outstanding andrepparttar 143952 interest payments. Forrepparttar 143953 rest ofrepparttar 143954 month, you can userepparttar 143955 account for day-to-day expenses and to pay direct debits. Some lenders require borrowers to pay in their salaries as soon asrepparttar 143956 account is up and running.

Cont'd on page 2 ==>
 
ImproveHomeLife.com © 2005
Terms of Use