I and my wife bought our first home in 1994. We chose an area on the western outskirts of Phoenix, Arizona. We wanted to be away from the congestion of the city, yet be close enough for convenient shopping. It was a 4-bedroom, 3-bath home that we shared with our two sons and her parents-in-law.

When I applied for financing, I went with a 7 percent variable rate mortgage instead of an 8.5 percent fixed-rate mortgage. I knew I could refinance later if the market conditions favored the fixed-rate mortgages, and I did. I locked in a 7 percent fixed-rate mortgage a few years after moving in.

Although our house was priced at $89,000 when we bought it, taxes and fees pushed it well above $100,000. It wasn't until 2001 or 2002 (I don't remember) to see that we finally owed less than the original $89,000. Such is the nature of amortized financing.

The real estate market didn't favor us selling to relocate anywhere during the first 10 years we owned the house. It was something we really wanted to do because the city inevitably encroached and surrounded our neighborhood. Heck, they even built both a football stadium and a hockey arena less than two miles northwest of us. Traffic in our area was getting unbearable.

In 2005 (or was it 2004?), the real estate market in Phoenix suddenly went crazy. Houses doubled and tripled in value and it seemed like it happened overnight. I and my wife had planned to make a major life decision (retirement) in five years. Knowing how volatile the market had become, we decided to sell and move as quickly as we could. I refinanced the house with a special 3-year mortgage, with ZERO percent interest, in order to pull out enough money from the equity to tile the floors that had linoleum, re-carpet, repaint, and re-landscape.

We sold the house in March of 2006 for $288,000. I owed $142,000 when I sold it and after closing costs, I still ended up with over $100,000 in profit. We used that money to wipe out all of our debts and to build and furnish our current home. It wasn't enough to finish everything, but that's okay, we now have all the time in the world. We are living proof that mortgages can be used to work to your advantage.

If you're living in the UK (and I'd really like to live in the UK, especially Scotland), use my example and compare mortgages before you buy a home. If you want to invest, you might even consider buy to let mortgages and rent the property out as a steady source of income.

As volatile as the real estate market can be anywhere in the world, it's best to shop around for mortgage quotes and options to avoid Bad credit mortgages. That is, unless you intend to buy foreclosures as a result of those mortgages.