Flexible Mortgages: What to look for
Interest charged daily
This is one of the major advantages of a good flexible mortgage. Most traditional mortgages calculate the interest charged on a mortgage at the end of the year, or at best the end of the month. The problem with this is if you pay capital off early, interest charges do not reflect the reduced capital until up to a year later. Cumulatively, this adds up to very significant interest being charged on money already paid back. By charging interest on a daily basis, flexible mortgages only charge interest on the amount borrowed at any time. This saves thousands if regular overpayments are made.
Withdrawal facility
Many flexible mortgages will allow you to draw further funds from your mortgage when you need them, without the need for any further authorisation. These withdrawals are simply added to the mortgage debt, so allowing you to borrow at your mortgages interest rate.
Some lenders take this facility to it's logical conclusion & actually issue you with a cheque book, allowing you to use your mortgage as an all encompassing bank account .
The lender will set a predefined limit to the amount you can borrow, normally up to 95% of your property's value.
Over & Underpayment facility
A quality flexible mortgage will allow you to make overpayments as often as you like, whether they be lump sum payments you make every year, additional payments every month or a combination of both, without applying any penalties. Furthermore, some lenders will allow you to take 'payment holidays' of up to six months, providing you've built 'credit' up through previous overpayments. This can be especially useful for the self employed, whose incomes tend to hit peaks & troughs.
For mortgage advice; a flat fee of £295.00 is payable upon application to the Mortgage Lender, the Practice will also receive a procuration fee from the Mortgage Lender, details of the level of this payment will be given to you, prior to you making any decision to proceed.
Alternatively;
You can elect to pay an hourly Fee rate of between £175.00* and £200.00 per hour, any procuration fee payable from the Mortgage Lender will be refunded to you. A minimum fee of 4 hours of chargeable time is applicable with this option, this would equate to between £700 and £1000, based on 4* hours of chargeable time. An average of 4 to 10 hours of chargeable time is usually applicable in most cases dependent on the level and complexity of advice required.
Your home may be repossessed if you do not keep up repayments on your mortgage.