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    • MSE Archna
    • By MSE Archna 11th Sep 06, 11:35 AM
    • 1,874Posts
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    MSE Archna
    The Australian mortgages that let you spend your house Blog Discussion
    • #1
    • 11th Sep 06, 11:35 AM
    The Australian mortgages that let you spend your house Blog Discussion 11th Sep 06 at 11:35 AM
    This is the discussion to link on the back of Martin's "The Australian mortgages that let you spend your house" blog. Please read the blog first, as the discussion follows it.


    Read Martin's "The Australian mortgages that let you spend your house" Blog
    Report inappropriate posts: forumteam@moneysavingexpert.com




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  • attmos
    • #2
    • 12th Sep 06, 9:30 PM
    • #2
    • 12th Sep 06, 9:30 PM
    yes, the problem with the flexible mortgages or the 'one' mortgages where your current accout is linked to your mortgage is that it's a lot easier to eat into your capital than pay off the debt quickly.

    The marketing all says how much you can save by paying off the mortgage quicker but i expect the reality is coser to 'spending your house' for many people. I know when i started my Nat west one account I had a few months of increasing my debt before getting control of my money.
  • chr1s
    • #3
    • 21st Sep 06, 4:57 PM
    • #3
    • 21st Sep 06, 4:57 PM
    We had one of these types of mortgages for the first 18 months or so of us buying a house, but mainly because it would lend us the most money (we didn't borrow over our capacity, but my wife is Australian - ironically - and her income couldn't be taken into account when we first bought our house). We now have a regular (i.e. non current account) flexible mortgage (at a lower interest rate thanks to tips on this site). One thing I was shocked at was how much money the bank we're willing to give me for my mortgage. If it was just me paying the mortgage (which as far as they were concerned, it was), there would've been absolutely no way I could've made the repayments.

    Also, I agree with the 'spend your house' for many people. I know people who treat it exactly like this. I think the problem is that the statements show you what you owe Vs the value of your house. They also often show you the amount available for you to borrow. This makes it seam like this is money you have, rather than (in effect) just another loan.....

    Chris.
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