One of my co-workers (about 50 years old) is about to buy a home. He just emigrated here and is correctly renting a home. The and his wife have money from selling their previous home. So far, so good.
He talked to a bank to get a preapproval for a mortgage, which is something you need here to make an offer on a home. The bank was presenting him the option of the flexi-mortgage. This is just an amount of credit that the bank gives you, based on the value of your home and you need to pay it back on a certain date, e.g. after 30 years. You need to pay a monthly interest, but you can decide not to pay that fee for several months as often as you like. As long as you pay it in the end with all the extra interest. You can also take out a big sum when the mortgage is partly paid down, to buy a car or a new kitchen, and just use the same mortgage. The mortgage has a higher interest rate than a traditional mortgage.
My co-worker thinks this sounds as a good alternative. He likes to be able to not pay the monthly interest for some months and then catch up later when he receives a lump sum out of a savings fund.
From me he just wanted to know whether this was something safe to bet on. I have heard a sincere financial expert speaking about this type of mortgage, who said it was a good alternative for people who are financially responsible, something my co-worker says he is.
I really had to keep my mouth shut for the rest of my thoughts. I would not get a mortgage with higher interest than necessary. I would also not choose to not pay the monthly fee for some months, because that means paying extra interest later. I really had to keep in mind that for my co-worker, it might be a good alternative, even though it means he won't be paying down his mortgage any time soon.
The good thing is that the bank has pre-qualified him for a mortgage that is twice as high as he asked for and he is not planning to get such a high mortgage. Good for him.