Fully Offset Mortgage - RBS

hermanmunster_3

Following sale of a second house can now fully offset my RBS mortgage - am planning to reduce the remaining principal down quite a long way but just leave some in mortgage account. Does anyone know
a) the least you can leave as a mortgage?
b) if it is fully offset, do you have to make regular payments and is there a minimum?
c) Has anyone had problems "re-borrowing" the money in the offset mortgage once it is paid off?

getmore4less

Why reduce the principle why not just offset costs the same and you keep access to your money?

IF your mortgage is on a repayment schedule then they will probably still expect a payment but because there is no interest you just take it out of your offset pot to keep the 100% offset.

IF you overpay rather than offset you need to check the T&C for getting the money back, with my Barclays offset the overpayments accumulate in a account that I can draw on without asking, no idea how the RBS one works for this case.

By why create a potential problem why not just offset rather than pay down the loan.

hermanmunster_3

cheers getmore4less - I would happily offset for years but DH still sees a mortgage as a debt.... so looks like we will be reducing the principal.

My concerns re overpaying as you infer are to do with getting the dosh back if we want to buy another place - T&C may let us at the mo but who knows if that will stay the same....

maybe will have to come to some "agreement" about leaving a larger chunk offset.... and see where we go from there.

Twister84

You can ring up the offset mortgage team and they can transfer the funds into your current account.

dimbo61

Are you on a great rate ? BOE+ 0.75% ?

You have the money to reduce the mortgage to a much smaller amount.
Do you have other savings ?
Unless you have plans to move to a bigger / more expensive propoerty and a great mortgage rate why not become mortgage free.

cathh70

I haven't got an offset mortgage, but I have paid off a large amount of the principal recently.

My provider said that we could reduce as low as we like (unlimited overpayments allowed), but recommended to leave a few hundred pounds. This is mainly due to having an ERC for another 5 years (12 yrs in total remaining), and we can't fully repay without incurring £2500. After leaving enough on the balance to allow our payments to continue for only the five years, we could have reduced our monthly payment to around £1 a month. Presumably with an offset (and no ERC) you can reduce as low as you want.

As other posters have said, it depends on your rate, what you could get elsewhere and how easily you may need access to the funds in the future.

dwsjarcmcd

I have a fully offset mortgage with FD and I want to keep it like that for future flexibility. I don't make any payments to it at all.