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Flexible Mortgages
Many Lenders are now offering variable rate
mortgages where the borrower can choose to overpay each month, underpay each month or even
take a payment holiday for an agreed period. In effect the borrower can use the
equity in a property as a capital reserve. In some cases a lender will provide you with a
cheque book that enables you to draw down the reserve funds.
These products require careful consideration
and it is recommended that potential borrowers discuss this
type of product at length with First Stop Mortgages to make
sure that they understand all the implications before entering
into any agreement. It is worth bearing in mind that when
the borrower reduces payments or takes a payment holiday,
the amount not paid will probably be added to the outstanding
loan and this may mean higher payments in the future. When
a borrower chooses to overpay on their mortgage they will
speed up the repayment by reducing the balance outstanding.
Also available in this section:
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