Flexible Mortgages

Overpayment

By overpaying, you can reduce the total value of your mortgage. This means you pay less each month, pay off your mortgage earlier and save money. Many lenders allow you to overpay by 10% of the total capital value of your mortgage each year. This means, for example, that if you have a £200,000 mortgage, you could overpay by £20,000 in a year without having to pay any charges. Some give you the option to overpay as much as you like without charge.

Underpayment

A few lenders (though not many) will allow you to make underpayments if you have already overpaid. This can help if your life circumstances change or you need to reduce your payments for a time. You should only ever underpay if your lender is aware of your circumstances and agrees to you underpaying.

Payment holidays

A payment holiday is an agreed period (usually up to three months) in which you make no payment to the lender. The interest you should have paid over the period is added to the mortgage, meaning your overall capital balance will be larger at the end of the period. Payment holidays are offered by even fewer lenders, but they can be helpful in certain circumstances.

Offset mortgages

An offset mortgage uses your savings to offset the interest that you are paying on the mortgage (up to 100% coverage). This is beneficial because most savings accounts do not earn much at the moment, because interest rates are so low. By reducing the amount of interest you pay on your mortgage, you repay the capital more efficiently, significantly reducing the overall cost of the mortgage by reducing your mortgage term. Talk to our team for more advice.