Saga savings

manhar

Are Saga savings accounts covered by FS compensation scheme?

KingL

Yes they are part of HBOS. See the table: http://www.moneysavingexpert.com/savings/safe-savings#whatcounts

manhar

I have my £40,000 mortgae with halifax. If I save in Saga accounts, will I still be compensated for £50,000 savings? I see that the two financial institutions count as one.

Baldur

manhar wrote: »

I have my £40,000 mortgae with halifax. If I save in Saga accounts, will I still be compensated for £50,000 savings? I see that the two financial institutions count as one.

They are both authorised under the Bank of Scotland FSA registration, so it's possible that savings could be set against the mortgage - see http://www.fscs.org.uk/consumer/faqs/deposit_claims_faqs/

5. What happens if I owe money to a bank, building society or credit union that fails? Amounts owed to the failed firm (for example, loans, mortgage or credit card debts) are taken into account before any compensation is paid.
If you are a borrower with the same firm this may affect the amount you can claim, as the amount of your deposits may be 'set-off' against any amounts you owe.
If a firm were to fail, FSCS would consider a depositor's overall net claim, which would include taking into account any amount owed which the firm may set off.
In the event that set off is applied, and if the borrowings exceeded the depositor's savings, there would be no overall claim against the failed firm, and the depositor would not be entitled to any compensation.
For example, if a depositor had a mortgage of £200,000 and savings of £150,000 with the same bank, set off may be applied by the Insolvency Practitioner dealing with the bank failure. As a result, the depositor may end up owing the bank £50,000, so there would be no positive balance and no claim for compensation.

manhar

Baldur wrote: »

They are both authorised under the Bank of Scotland FSA registration, so it's possible that savings could be set against the mortgage - see http://www.fscs.org.uk/consumer/faqs/deposit_claims_faqs/

But doesnt that simply mean that the mortgage has been paid off and you are not really losing your money?

soulsaver

manhar wrote: »

But doesnt that simply mean that the mortgage has been paid off and you are not really losing your money?

True, very true... might not be what you planned though. you'd have to go & get another mortgage with its associated costs to get back in the same position.