Mortgage Current Account

MB1919

I'm just about to re-mortgage and the best deal out there for me, according to my broker, is one offered by the Woolwich. It comes with a 'Mortgage Current Account'. I know this means I have to take out a current account with Barclays, but my broker insists that I do not need to make use of the account at all. What is the point of such an account? Would I in any way disadvantage myself if I took out such a mortgage? The rest of the deal is very attractive indeed, but I can't seem to get my head around this requirement to take out a mortgage current account. Could someone please explain it to me and put my mind at rest?

atlantis187

Ur mortgage payments come out of the current account also if the mortgage is offsett the account will be linked to the mortgage

blueberrypie

atlantis187 wrote: »

Ur mortgage payments come out of the current account also if the mortgage is offsett the account will be linked to the mortgage

Your mortgage payments come out of whatever account you have chosen - it has nothing to do with the Barclays Mortgage Reserve Account. If your mortgage is an offset mortgage, I believe it's possible to set the Barclays account up as an offset account, but the existence of the account doesn't make it an offset mortgage.

To the OP: as you pay off your Woolwich mortgage, the approved overdraft on the Barclays account will increase. There might also be an approved overdraft facility from the start - you do need to apply for this, so ask your broker if that's what he's advising. Even if you don't apply for an overdraft amount at the beginning, it will increase as the amount owing on your overdraft reduces.

You don't ever have to use the account at all if you don't want to, or you can use it as a regular Current Account if you wish. Or you can just use the overdraft facility. If you do use the overdraft, you'll pay interest at Barclay's SVR.

jamesperrett

I have a Woolwich Mortgage. The Mortgage Current Account allows you to borrow more money at Barclays' standard variable rate. However, you should ask for an approved borrowing limit when you apply for the mortgage. If you don't ask for an approved borrowing limit when you apply they will charge something like £150 to set it up for you later.

They seem to set up a Mortgage Current Account whether you ask for one or not but you don't have to use it. I know that I didn't ask for it but I still received a cheque book and card which I've just locked safely away.

Cheers

James.

MB1919

Thanks for all the replies. Rather like the poster above, I will most probably not make use of the account at all. You have all managed to clear things up for me and have removed any nagging doubts in my mind. It looks like I'll be taking the deal. Thanks again.