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Barclays Offset Mortgages & Helpful Tricks/Setup!
Lopo
Posts: 484 Forumite
Hi all...
Just thought I'd open a thread to see if there are any tricks to help people along with offset mortgages. I'm with Barclays in particular, hence the thread title...but the suggestions here may help others too if who they mortgage with is similar in setup...
I'm new with Barclays, and its going pretty well with the offsetting, but noticed there are one or two things you can do to help things along.
Firstly...they charge interest daily, but its gets added at the end of each month...you then see this appear on your account at the beginning of the month as a big scary sum most likely!
Direct Debits, if you have them setup will *always* be debited on the 16th of each month with Barclays - these cannot be changed I am told.
So with all that in mind, once they have added their interest charge, the mortgage debt is increased, and you get charged interest on that increased amount too for those 16 days until the DD is taken later.
To eliminate that - I've found its sensible to setup a standing order to make a payment to my mortgage at the beginning of the month and replace my Direct Debit - effectively this is bringing the two charge and payment dates closer to each other and reducing the interest (on the interest effectively!) you do pay to them.
With this method though – it is important to ensure your standing order payment will meet the mortgage repayment required. If your balances fluctuate high and low a lot – do beware!!
Shame they cant just let you change the DD date.
Secondly...When overpaying monthly - always have the mortgage setup to reduce the monthly payment amount and not the term length. Extra cash will just be offset against what you owe, and you will always have access to your cash should you ever need it in an emergency. You can happily make lump overpayments later whenever you like.
Thirdly...Barclays allow you to offset your cash ISA’s keeping their tax free wrapper status effectively.....its great! Transfers in were very speedy too. Anyone know of any others that allow this too?
Sadly...I find their super secure online banking a bit of a mare traversing through....but safety first as they say...cant complaint too much.
--
Hope these thoughts do help others....any other top tips out there that anyone can suggest please!?
( I hate my mortgage!! ! )
Just thought I'd open a thread to see if there are any tricks to help people along with offset mortgages. I'm with Barclays in particular, hence the thread title...but the suggestions here may help others too if who they mortgage with is similar in setup...
I'm new with Barclays, and its going pretty well with the offsetting, but noticed there are one or two things you can do to help things along.
Firstly...they charge interest daily, but its gets added at the end of each month...you then see this appear on your account at the beginning of the month as a big scary sum most likely!
Direct Debits, if you have them setup will *always* be debited on the 16th of each month with Barclays - these cannot be changed I am told.
So with all that in mind, once they have added their interest charge, the mortgage debt is increased, and you get charged interest on that increased amount too for those 16 days until the DD is taken later.
To eliminate that - I've found its sensible to setup a standing order to make a payment to my mortgage at the beginning of the month and replace my Direct Debit - effectively this is bringing the two charge and payment dates closer to each other and reducing the interest (on the interest effectively!) you do pay to them.
With this method though – it is important to ensure your standing order payment will meet the mortgage repayment required. If your balances fluctuate high and low a lot – do beware!!
Shame they cant just let you change the DD date.
Secondly...When overpaying monthly - always have the mortgage setup to reduce the monthly payment amount and not the term length. Extra cash will just be offset against what you owe, and you will always have access to your cash should you ever need it in an emergency. You can happily make lump overpayments later whenever you like.
Thirdly...Barclays allow you to offset your cash ISA’s keeping their tax free wrapper status effectively.....its great! Transfers in were very speedy too. Anyone know of any others that allow this too?
Sadly...I find their super secure online banking a bit of a mare traversing through....but safety first as they say...cant complaint too much.
--
Hope these thoughts do help others....any other top tips out there that anyone can suggest please!?
( I hate my mortgage!! ! )
Beware Lego Men with Deep pockets...! :cool:
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