A flexible mortgage can allow you to make additional payments ‘top up’ payments to reduce your loan liability or you can also build up a fund of money which you can ‘draw on’ in the future.

Some mortgage lenders who offer this type of flexible mortgage will permit you to reduce your payments or even stop your payments for a period known as a ‘payment holiday’ providing you have maintained to the agreement.

The interest on a flexible mortgage is calculated daily or for each month so you can see the affects of your mortgage account standing on regular basis instead of having to wait for an annual statement. By seeing these statement you can see the positive affects of any over payments you have made to reduce the overall loan and can encourage you to pay off your mortgage early than scheduled and to reduce the amount of interest you pay.

The flexibility of having a ‘payment holiday’ can be very useful especially when you have a baby or starting to pay for school fees or when you want to renovate your property or other unexpected events.

Mortgage lenders will have different rules when it comes to offering a ‘payment holiday’ and they usually expect you to build up a reserve in advance before you can do this. It must be remembered however you will still incur interest charges on your mortgage account during a payment holiday.

Flexible rate mortgage will allow you to make additional payments to your mortgage to suit your particular circumstances without imposing a penalty. In the past Flexible Rate mortgages would normally have charged a higher rate of interest but in today’s highly competitive mortgage market many of the mortgage lenders will now offer a flexible mortgage deal at the same competitive rates of interest.

Not all Flexible Mortgages advertised are the same and you should thoroughly research the lenders small print to fully understand what is meant and what is included in each mortgage lenders deal. You should also check that there are no limits on the amounts and the frequency with which you can over pay or under pay without incurring a penalty.

A flexible mortgage is a very good way to keep your mortgage on a reducing basis provided you are going to make additional payments.

You should always take advice before you commit yourself to borrowing from a lender with a flexible rate term mortgage.

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