Offset Account or what?

sammyian

I'd like to know whether i'm missing something obvious here.

Our 2yr fixed fee mortgage (4.59%) is up shortly and we're looking at what the next step should be. My natural inclination would be to take another competitive fixed fee mortgage however.

We have recently been given £100k as pre-inheratence which has thrown us slightly with the best option to take.

Our current mortgage is £130k and we're considering several options.

We'd like to keep the £100k semi accessible since we are considering emmigrating to oz in the next few years and don't want have the money tied up in the house.

I've seen you can get 5.7% - 5.8% high interest savings accounts which seems a good option for the money.

Alternatively we could take an offset mortgage with our current lender for 5.7% and put the money in that (and not pay tax on the money saved) with minimal fees involved.

However, i have a nagging feeling that there is something better out there to do with the money. Any ideas? Is the offset a 'No Brainer' are there better alternatives?????

silvercar

personally I would go for a fixed rate offset. that way your interest rate is fixed and you get the benefit of the savings at the interest rate. you could either have low mortgage payments based on the net £30,000 or make higher payments and knock ££££s off your mortgage.