Offset Mortgages ISA
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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.
An offset mortgage is a type of mortgage that is joined to your savings account. There are many different types of savings accounts and financial products that could be linked to an offset mortgage; ISAs, current accounts, credit cards and unsecured personal loans are among the most common.
There are many different banks and building societies that could offer you an offset mortgage ISA deal. To ensure that you find the best possible offset mortgage deal available to you, it is strongly recommended that you compare a number of different deals from different lenders.
The FREE calculator below could help you find the right offset mortgage deal for you:
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Here is an outline of how an offset mortgage tends to work:
- You can link the following to your offset mortgage: ISAs, current accounts, credit cards and personal loans
- Rather than gaining interest on credit balances, the amount of interest that you are expected to pay on your mortgage is reduced
- For example, if your mortgage was £250,000 and you had £50,000 in an ISA, you would only pay interest on £200,000 of your mortgage loan.
The pros and cons of offset mortgages ISA deals are widely considered to be the following:
- You will not have to pay income tax on your savings
- Offset mortgages tend to be flexible, allowing room for over- or underpayments and payment holidays
- You could end up paying your mortgage loan back ahead of schedule, as monthly repayments are calculated based on the overall amount of your loan
- Many offset mortgages could come with arrangement fees
- You forfeit the opportunity to earn interest on your savings
- Offset mortgage interest rates may be higher than on other mortgages
- An offset mortgage requires a lot of discipline; if you withdraw lots of funds, your interest rates could significantly increase
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