natwest offset mortgage

mickey

hi guy's
anybody know the ins and outs on this it seems to be too good to be true.
i presume its a type of the one account by virgin?
are there any pit falls i should look out for?

brokerclancy

Hi there,

There are two types, the Current Account mortgage and the Offset Flexible. They are very different in the way they work.

If offsetting is what your after then compare it with the others who offer this type of mortgage. However, if you are looking for the flexible benefits, there are better deals out there.

The Virgin mortgage was taken over by RBS, which is now known as the One Account and Natwest is part of RBS now so you are right to compare it against that.

What is so good about it?

johna999

Look at the barclays (woolwich) offset, if you have 80 LTV the rate is 0.48 above base rate for the term of the mortgage. Nat west seems expensive

emmarbos

I actually am a mtge advisor for natwest...

The offset is basically a mortgage with a variable rate of interest.
Each month you pay your mortgage as you would normally, (eg. £100k over 25 yrs = £500 pm for arguments sake).

You have the option to overpay, make lump sum payments, without incurring any early repayment charges. You can also take payment holidays and make underpayments (up to 6mths in one 12 month rolling period.)

You can opt to link one current account and up to 3 savings account (limited to what NatWest accounts you can link) the accounts have to be with NatWest and if it is a Joint mortgage, all the accounts have to be joint, and like wise if it is a sole mortgage all the accounts linked have to be sole.
Your accounts stay seperate, however any money in these accounts offset against your mortgage therefore it will reduce the amount of interest you pay on your mortgage, and also reduce the term of the mortgage.

For all sole traders, and simple partnerships, you can also link your NatWest Business accounts, obviously for sole traders you will have an account in your name only, so it doesnt matter if its a joint mortgage.

The minimum loan for an offset mortgage is £30,000 and the minimum term is 3 years, although if you pay it all off in 6 months though overpayments this doesnt matter. There is a fee of £345, to set it up, and if you are remortgaging you get free legals and free valuations.

You also have the option to add a facility onto the loan, so should you need it, its there, this doesnt cost you extra each month either, eg. if you knew that in 2 years time when the kids leave home you would like to do up the kitchen and you will be needing about £10,000, to save going for a further advance with ourselves you just simply request that facility, and it will be added to the loan. Easy no paperwork.

:: The advice is appreciated but please be advised that touting for business is against our rules and i have removed part of your post accordingly - FM ::

Em

silvercar

most of what emmarbos says applies to any offset mortgage. there are many lenders now offering offsets, including some offering fixed rate offsets. Make sure you compare the rates that are available.