Offset mortgages

Tassotti

Obviously these are the way to go, who can offer offset mortgage up to 90% below stupid interest rates?

Tass

happybroker

what do you call stupid interest rates?

herbiesjp

If you have savings to offset they may be the way to go, if you have minimal savings you will be paying a higher interest rate for no benefit

jimbo_the_jetset

First Direct's fixed offset at 5.95% (3 year) isn't too expensive or a tracker at 6% aren't too bad if you ask me.

Especially when Nationwide can only offer me a tracker at 6.38% for our remortgage

Wutang_2

Obviously these are the way to go...??

Really?

beingjdc

Yeah, they're the way to go if you have savings far above your ISA allowance - but if you only have a 10% deposit, that's not really the case, so an offset mortgage would only be suitable if you were expecting to pay off quickly, or it offered a competitive interest rate.

PeteHi

how much is paying your wages into an offset account (around £4000 pcm) likely to save you over the year?

From what Im reading, its only really beneficial if youve got huge savings.

gil13

Quite a few MSE'rs were drawn into FD offsets, myself included, firstly because they were offering the best fixed interest rates, the bonus is the flexibility of the offset arrangement. I think the churning of money through any linked current account is of small benefit unless you are talking huge numbers. But I don't agree you need huge amounts of savings to get a benefit, some saving is better than none. The interest rate was really the key thing for me and I may well even leave it as interest only if I can achieve a higher return in bonds or other. The only commitment with the FD set up is paying the interest each month you can go I/O, borrow back, offset all without fees. So to me it seemed an excellant arrangement although will take some managing I suspect and not for everyone.

PeteHi

gil13 wrote: »

Quite a few MSE'rs were drawn into FD offsets, myself included, firstly because they were offering the best fixed interest rates, the bonus is the flexibility of the offset arrangement. I think the churning of money through any linked current account is of small benefit unless you are talking huge numbers. But I don't agree you need huge amounts of savings to get a benefit, some saving is better than none. The interest rate was really the key thing for me and I may well even leave it as interest only if I can achieve a higher return in bonds or other. The only commitment with the FD set up is paying the interest each month you can go I/O, borrow back, offset all without fees. So to me it seemed an excellant arrangement although will take some managing I suspect and not for everyone.

I'll have to see what savings I can muster up then/check down the back of the sofa etc.

I'm moving to FD as well as their fixed rate was the best, think I'll just switch all my banking through them, saves juggling 2 accounts.