Flexible Remortgages

When it comes to deciding what you want in a remortgage, it can be difficult to navigate your way through the various options. A flexible mortgage is that has flexibility built in, as you might expect.

Payments

With a flexible remortgage deal, you can both overpay and underpay depending on your income. These remortgages are designed particularly for people who want the ability to pay their remortgage off relatively quickly. Unlike many mortgages, which enforce fees for early paying off of the balance, flexible remortgages do not, and you can therefore pay them off as early as you like.

Income

If your income is likely to be changeable you may also want to consider a flexible remortgage, as you may not be able to commit to having a set amount of income to pay towards your mortgage each month, and may have income that varies significantly throughout the year.

Some flexible mortgages offer the ability to have breaks in your repayments also, for example if you have a change in circumstances that affects your income such as illness or job loss, although this depends both on the remortgage deal itself and sometimes on how much of the mortgage you’ve already paid off at that point.

Borrowing

Another advantage to some of the remortgage deals available is that they may allow you to borrow against the amount of the total lending that you’ve already paid for, although this is only an option for certain deals.

Rates

The interest rates for flexible mortgages vary, but are typically affected to some degree by the Bank of England base rate. You therefore may need to bear in mind any changes to the rate when working out what your repayments are likely to be like.

Term

Among the disadvantages to flexible remortgages is that if you consistently make under payments, you may end up significantly lengthening the term of the mortgage and be stuck with it for a much longer time than you had anticipated.

Cost

Another common disadvantage to a flexible remortgage is that you may well find it incurs generally higher rates of interest than is standard. The ability to potentially pay the mortgage off sooner and to have this inherent flexibility therefore may well come at a cost.

Whether or not a flexible remortgage is right for you will depend both on your on lifestyle and approach to lending, however always make sure you understand the terms before going ahead with one.