When you take out a mortgage, it is sometimes possible to choose a flexible loan. But what is the point of such a loan and how does it work in practice?
This is a mortgage, the rate of which remains fixed, but the monthly payments can be revised down as well as up depending on the vagaries of life. It therefore opens up the possibility for the subscriber to modify his repayments, giving him considerable flexibility compared to a conventional loan. The main advantage of this type of loan is its ability to adapt to your income. Thus, in the event of a change in your situation, for example following a dismissal or a separation, which result in a reduction in your income, the freedom to modulate the loan is a real asset. Similarly, in the opposite direction, if your income increases or you benefit from a cash inflow, you can increase your monthly payment. Generally, each monthly payment can vary between 10 and 30%.
What can we modulate?
Several elements can be modified with a flexible loan. On the one hand, it is the due date, which consists of being able to increase or decrease the amount of the monthly payments. This therefore affects the duration of the loan. So, if you choose to increase your monthly payment, the repayment will be faster. On the other hand, the due date can be postponed, which allows the repayment of monthly payments to be suspended for a few months, an option which depending on the contract is possible between 6 and 24 months. Such flexibility makes it possible to cope with unforeseen events in life, such as a dismissal. Finally, early repayment is also possible for part of the loan. But it is necessary to check the conditions of his contract, because certain increases in reimbursement may then be required.
It is therefore important to seek advice from your broker, who will take your needs and constraints into account. He can then offer you a loan adapted to your situation, drawing on a large panel of partner banks.