Flexible mortgages were first introduced into the UK to cater for individuals with flexible working patterns.

People who have irregular working patters such as the self-employed, and people who receive irregular payments such as bonuses and commissions, were the initial target market for flexible mortgages.

Typical features of a flexible Mortgage include:

• Overpayments
• Underpayments
• Drawdown of overpayments made
• Additional borrowing facilities
• No (or low) redemption penalties

In addition to the features that allow for flexibility with payments, the interest on flexible mortgages is calculated on a daily basis. This can result in massive savings to the borrower and can significantly reduce the term of the loan.

For this reason flexible mortgages have become popular with people in all types of employment who are looking to pay off their home sooner.

Interest rates are generally higher for flexible Mortgages than for traditional products to counter the increased risk of the borrower not repaying the full balance of the loan by the end of the term. The flexibility of this style of mortgage allows for this to happen.

Some flexible mortgage products can also be linked with current accounts, chequebook facilities, debit and credit cards, unsecured loans, and offset accounts.