YBS Offset Mortgage, Its Complicated!

etom43

Hi Everyone, was hoping someone might know a little bit more about the YBS offset mortgage as i am a bit stuck.

Brief Overview of our situation

Me and OH own a property, value £210,000, mortg £75,000.

We have just had an offer of £302,000 accepted on a property, which we plan to purchase by putting down a £75,500 deposit and borrowing the rest on a 2yr offset fix for 3.15% with YBS.

We are fortunate enough that we do not have to sell our existing property immediately, but plan to do so when we have renovated the new property. This should net us about £135,000 which we will immediately add to our offset savings account on the new property.

Whats the Catch

I just dont get why YBS would let us do this. We are getting a low fixed interest rate with effectively no tie-in. Whats the catch? is there a maximum amount we can put in our offset savings account? hidden charges? i cant see reference to anything like this on their website, or am i just being paranoid?

All help is much appreciated

Ed

Thrugelmir

etom43 wrote: »

Hi Everyone, was hoping someone might know a little bit more about the YBS offset mortgage as i am a bit stuck.

Brief Overview of our situation

Me and OH own a property, value £210,000, mortg £75,000.

We have just had an offer of £302,000 accepted on a property, which we plan to purchase by putting down a £75,500 deposit and borrowing the rest on a 2yr offset fix for 3.15% with YBS.

We are fortunate enough that we do not have to sell our existing property immediately, but plan to do so when we have renovated the new property. This should net us about £135,000 which we will immediately add to our offset savings account on the new property.

Whats the Catch

I just dont get why YBS would let us do this. We are getting a low fixed interest rate with effectively no tie-in. Whats the catch? is there a maximum amount we can put in our offset savings account? hidden charges? i cant see reference to anything like this on their website, or am i just being paranoid?

All help is much appreciated

Ed

Until you sell your existing property you won't be depositing much into the offset account. As its only on a 2 year term is it worth it? As then the rate rises to 4.99%.

With an offset account the "savings" balance cannot exceed the mortgage balance.


Product fee is a £1,000, so more fees payable in 2 years.

dimbo61

I have a YBS offset mortgage for the last 5 years and have been very happy with our choice of lender and product.
Your mortgage will revert to the YBS SVR which is currently 4.99%
They have some of the best long term fixed offset deals on the market ( check "which "website)
I am in a 5 year fix and paying nearer 5 % but we offset as much as possible.
I love the flexability that an offset offers.
Offset mortgages may well suit your circumstances but check out First Direct as well.
Even after selling your old property you will still have a mortgage of over £100,000 so think long term
rates have never been this low !

dimbo61

Remember there is a 3% ERC if you want to get out early from your fix