Offset Mortgage Savings Account
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Overall Cost for Comparison 3.80% APRC. This is the cost of the mortgage over the full term. Early redemption charges may apply.
Using an offset mortgage, your savings account is linked with your mortgage loan to reduce the interest you pay and the overall cost of your mortgage. You can also link your credit card and current account to your mortgage loan in order to further reduce the amount of interest you pay. Your mortgage lender will use the interest accumulated on your savings and put this towards your loan repayments.
Offset mortgage deals can be highly useful for many people in the right situation, although they heavily rely on the use of savings to make them cost effective. If for example you have £10,000 of savings and a mortgage of £200,000 you will not have to pay interest on the remaining £10,000 of your mortgage loan as long as your savings remain linked.
Instead of earning interest on your savings, they act as a means of reducing the overall size of your mortgage. There are also several different types of offset mortgage available, and customers should therefore shop around and compare mortgage offers from different providers to find the most competitive deal
You may wish to take a look at our mortgage comparison tables below for an idea of the different offset mortgages that are available:
No mortgages were found which match these requirements. Please use the search form above to find mortgages which suit your precise requirements.
Some advantages in using an offset mortgage are:
- You do not have to pay income tax on your savings because they are linked to your mortgage loan.
- Offset mortgages are flexible – payment holidays, underpayments and overpayments.
- You may repay your mortgage loan before the end of the set term established by your lender.
Some disadvantages in using an offset mortgage are:
- Interest rates may often be higher than in other mortgage deals
- You may have to pay arrangement fees
- You will not be able to earn interest on the money in your savings account
- You should mindful of withdrawing money from your savings account, as this can significantly increase your interest rates
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
The above mortgage products highlighted on this website are available directly through lenders who will be able to provide further information about the product you are interested in. If you are unsure about what mortgage product is suitable for you, we suggest you speak to an independent mortgage broker