Borrow against mortgage to save ??

frigal100

I currently have access to an existing tracker mortgage which is largely paid off and can borrow and extra £90,000 at 1% interest. With some instant access savings accounts paying anything up to about 2.5/3% (sometimes including bonuses) what's the downside in taking £90k out the mortgage and putting it into savings (max £50k in any one account). This should clear +1% interest profit after paying baisc rate tax on the savings. Seems too good to be true!?!

Any advice gratefully received.

Reaper

There have been a couple of similar threads on the subject which may answer your question. Try this one for starters:
http://forums.moneysavingexpert.com/showthread.html?t=1546743

frigal100

Thanks for the response and pointing me in the direction of a previous thread. Seems like as long as I don't put the money in the bank of timbuktu and stick with a UK mainstream bank (preferably partially government owned) this seems a pretty safe bet. All I've got to do now is convince my other half that there isn't a catch and, yes, if some silly bank is willing to lend monay at x% and another silly bank is willing to give us interest at X+1% then we will indeed be in profit.

:j

Wookey

As long as you can retreive the money at any time and pay it all back then shouldn't be any problem, check out if there are any fee's and bear in mind interest rates could shoot up at any time. No point paying out a fee only for rates to go back up a bit in a few months wiping out any gain if any you would make.