Compare Offset Buy To Let Mortgages
Providers are quick to point out the tax advantages to this type of mortgage deal, as customers will not be expected to pay any tax on debt interest. Buy to let offset mortgages are also very flexible, as customers can take payment holidays without any financial penalties.
Unfortunately however, lenders will charge higher interest rates compared to other loans in order to compensate. In order for an agreement to remain viable, customers should have quite a substantial sum saved up in order to pay off their mortgage. Savings amounting to around 20% of their total mortgage is usually advisable in order to get the best possible return.
For customers that have saved a sufficient amount, the payout for a 25 year offset mortgage can be very positive.
It is also worth remembering that some buy to let mortgage policies may allow customers to link savings and current account balances to the mortgage. The earliest types of buy to let offset mortgages in the UK were usually linked to customer’s current accounts.
Under this agreement, the balance of the customer’s current account would be automatically added to their mortgage. So if for example the customers balance is at £60,000 and they have £4,000 in their current account, the amount of debt you will pay interest on will be reduced to £56,000. This balance would be adjusted very frequently, and the mortgage holder would only be expected to pay interest on the reduced figure.
If you are searching for a suitable mortgage deal, it is recommended to shop around - Use our specialist buy to let mortgage advice service to help you get the best deal.