|
|
|
|
|
you are here:
Homepage
>
Mortgages and Loans
>
Flexible
Mortgage UK Quotes and Information
> |
Flexible Mortgages UK �
by using a Buy to Let mortgage that is also a 'Flexible Mortgage' it becomes
much easier to achieve your financial goal(s). This is because you will have a
very adaptable financing structure underpinning your business plan. A
�flexible mortgage� has the following 'generic' key features:-
- Daily interest calculation � by
calculating interest on a daily basis massively reduces overall interest
payments by thousands of pounds!, against traditional mortgages (that
calculate interest monthly or even annually in arrears). This is achieved by
paying your regular rental income into the account � overpaying on the
mortgage; then by managing your regular outgoings (letting expenses) so they
are paid as late as possible (for instance using a credit card to defer
payment for as long as possible) � this in turn keeps your daily mortgage
capital balance temporary lower � remember interest is calculated on your
outstanding daily balance.
- Ability to Overpay � this allows you
to overpay (over and above your regular mortgage repayment) by any amount,
in order to immediately reduce mortgage capital balance without penalty. In
reality, this works by incrementally overpaying on the scheduled agreed
mortgage amount using the rental income coming in. This saves thousands of
pounds in interest payments over the life of the term.
- Payment Holidays � this feature
allows you to take a break from making monthly mortgage repayments �
sometimes for up to a year. This provides flexibility because you can
potentially eliminate cashflow problems during unexpected void periods.
- Underpayments - this feature allows
you actually pay less than the set monthly amount (only after you have made
overpayments). This provides flexibility because you can potentially
eliminate cashflow problems during unexpected void periods.
- A Draw Down Facility � this allows
you to borrow additional funds at same low rate (compared to credit card or
loan rates) to fund improvements; for example, major unexpected and costly
roof repairs.
- A Current Account (savings) linked as
part of the mortgage account. This means you save interest on your debts
(credit cards, loans etc) as you only pay the lower mortgage interest rate
i.e. 5% versus 19.8%, for example on most credit cards. Remember the cost
(interest) of borrowing is always more than interest on savings accounts. In
addition, you pay no tax on the interest on your savings (as they in effect
are combined with (and reducing) your debt (mortgage) � the taxman does not
classify debt as taxable.
- No Redemption Penalties - if your
goal is to maximise your income through property letting it is vital you
know from the outset that you can pay the mortgage off early without penalty
(through mortgage overpayments from rental income), again saving thousands
of pounds in interest payments.
back
to top
|
|
|
