should I pay off my offset mortgate?

stomachstaple

Hi Ya'll

In light of the credit crunch and my paranoia about losing my savings should I pay my mortgage off? I have enough money in my offset account to pay off my mortgage. I pay no interest on the mortgage due to the amount of savings offsetting it. The amount of the mortgage left amounts to about 12 thousand pounds. I need some advice thanks : )

StuartGMC

If the savings are your total amount, don't pay off the mortgage just yet. You need savings reserves of anywhere from 3-6-9months income.

If however, you have additional savings you could pay it off, but, I think even if your lender got into difficulties the two would be balanced and they would "force" you to py it off. So, this may be your only concern in reality, i.e. having the savings taken to payoff mortgage if you don't have any others?

I assume you are covered for the £50,000 via your bank operating under British Banking license, so, just relax and get some additional money saved until you have your rainy day fund. then pay off the mortgage and celebrate!

stomachstaple

Thanks lots for that advice - if I paid off the mortgage I'd have no savings at all which is also worrying. I'll therefore hang fire and see what transpires - Thanks again Stuart : )

dimbo61

Start filling a cash ISA £3600 up till april 4th
You can get 6/6.25% tax free so if your mortgage rate is less than this take some money out of the offset and fill an ISA.
Come april 5th fill another ISA with £3600 and save( repay this money) into the offset account if you can.
If you have OH consider putting in 2x£3600 each year. GOOD LUCK