A truly flexible mortgage is one that allows you to do more than simply pay the minimum payment each month with no alternative options. Banks and lenders have the capacity to offer you some amazing flexibility with loan products and yet so many people are unaware of these extra features and benefits that they end up simply shopping around for the cheapest interest rate instead.
Interest rates versus flexibility
Did you know that the mortgages offering cheapest mortgage interest rates available can often be the least flexible of all the mortgage types?
There are some seriously inflexible loan options available from some lenders. They may look like really cheap options at first, but when you dig deeper into the terms and conditions on the mortgage, you might find that you'll be charged massive penalty fees if you sell your home and pay out your mortgage within a specified time frame.
Ability to make extra repayments
Some of these inflexible mortgages also limit the amount of extra repayments you're allowed to make on your balance, charging you further penalty fees for paying too much off your own loan. This can be really detrimental if you want to make a few extra repayments to put you ahead.
When you applied for your mortgage, did your lender offer you a flexible mortgage?
Weekly, fortnightly or monthly loan repayments
Flexible mortgages should allow you the freedom to make your repayments when and how you choose. If you're limited to making only monthly repayments with no option to alter this to pay fortnightly or weekly then you're being limited to an inflexible mortgage.
Another flexible mortgage option is the ability to make excess repayments without being charged a penalty fee for paying more than just your minimum payment.
Switching home loan products when your circumstances change
These two basic features are available on the majority of loan types, but other flexible features include the ability to switch loan types to suit your financial circumstances at any time. You might want to switch between principal and interest repayments or over to interest only mortgage options. You might prefer to switch between variable and fixed rates.
Changing to a flexible mortgage can mean accessing options for amending, altering or otherwise restructuring your mortgage to suit your financial plans and goals.
For example, did you know that having a portability option on your mortgage means you might be able to simply sell your current home and buy a new home, while your old mortgage is able to be moved from one house to the other simply?
Different banks offer a variety of features and flexible options on their mortgage broker products. In some cases, you can even tailor your mortgage to suit your own goals and financial needs.
If you're not sure what kind of flexible mortgage features your current mortgage has, or if you'd like your next mortgage to have some of these benefits then call a professional Choice Home Loans mortgage consultant today to discuss your options.