Buying guide
Revolving credit mortgages: what are they & how do they work?
Everything you need to know about this useful but potentially expensive home loan feature
AI summary
A revolving credit mortgage is a home loan feature that works like a large overdraft, letting you deposit and withdraw funds.
This flexibility can help you pay your mortgage off faster and save on interest, as you only pay interest on the outstanding balance.
However, it requires strong financial discipline. These loans often have higher variable interest rates than fixed-rate options, making them costly if not managed well. Seeking advice from a mortgage broker is recommended before committing.
What is a revolving credit mortgage?
The benefits of a revolving credits
May help you pay your mortgage off faster
Extra flexibility
Revolving credits can be great but they can be expensive if they're not managed well.
Lower interest rate than a bank overdraft
Only pay interest on money you’ve used
The drawbacks of revolving credits
You need to be disciplined
They’re expensive
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Make sure you do your homework before applying for a revolving credit.
Making a revolving credit work for you
Get expert advice before signing on the dotted line
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