Offset mortgage vs 2.79% 5yr fix?

notanewuser

The FD offset allows you to eithdraw anything up to the original balance of the mortgage. Ours started at 5.49% (10 yr fix) on £175k in 2008. It's now at £106k, and instead of overpayments we've ploughed all spare cash into the linked accounts so its now fully offset (so not paying any interest whatsoever). We effectively have £70k available to withdraw should we wish to.

If we wanted to make any overpayments or change our repayment amount it's easy to do online. It's a brilliant system IF you have savings.

You will have to move your current account to FD as part of the application process though.

getmore4less

Remember, where you have to ask for overpyments money back the policy can change so you can't get it back.

Offset you never give up the money.

michaels

notanewuser wrote: »

The FD offset allows you to eithdraw anything up to the original balance of the mortgage. Ours started at 5.49% (10 yr fix) on £175k in 2008. It's now at £106k, and instead of overpayments we've ploughed all spare cash into the linked accounts so its now fully offset (so not paying any interest whatsoever). We effectively have £70k available to withdraw should we wish to.

If we wanted to make any overpayments or change our repayment amount it's easy to do online. It's a brilliant system IF you have savings.

You will have to move your current account to FD as part of the application process though.

I keep asking FD if they have any plans to offer an offset fix of more than 3 years and they say they can not tell me...

latecomer

getmore4less wrote: »

Remember, where you have to ask for overpyments money back the policy can change so you can't get it back.

I dont imagine they would be able to change the terms of the mortgage in such a way without giving you plenty of notice. I'll need to dig out the paperwork when I get home to see what it says.

notanewuser

michaels wrote: »

I keep asking FD if they have any plans to offer an offset fix of more than 3 years and they say they can not tell me...

Ours started on 1/10/08.


The credit crunch happened on 8/10/08.

yeahdisk

We're just going through the process with co-op and this is what we were told....

You can overpay 10% a year without charge on their fixed rate products. This applies to any Brittania or Smile mortgage as well (same company).

However, only their online products (coop online or smile) allow you to redraw the overpayments in the future.

Because of this we signed up online. Hpe this helps

getmore4less

latecomer wrote: »

I dont imagine they would be able to change the terms of the mortgage in such a way without giving you plenty of notice. I'll need to dig out the paperwork when I get home to see what it says.

have good look

It might allready be in the terms but not obvious.

The key will be do you have to ask and what condition they put on the request.

or

do you have access that you can use without asking.

So...me Barclays customers got caught out when their overpayment withdrawal mechanism was reduced on some of their mortgages.

Matt_The_Chippy

I've just seen this thread and wanted to add my tuppence to things.

I'm with Santander on their Offset mortgage 2.99% over base rate (3.49%). This rate is for the life of the mortgage. I love this product compared to a regular repayment mortgage. I can overpay any amount without fear of penalties, I can reclaim any amount that is in the offset with a days notice.

I've never been a saver in my life but I'm finding myself looking for money to put into the mortgage account. So, it could be worth considering if it fits your needs like ours.

latecomer

getmore4less wrote: »

have good look

It might allready be in the terms but not obvious.

The key will be do you have to ask and what condition they put on the request.

or

do you have access that you can use without asking.

So...me Barclays customers got caught out when their overpayment withdrawal mechanism was reduced on some of their mortgages.

Did Barclays not give any notice of the change?

Didn't get a chance to look through the paperwork last night but will try and do it tonight. We (well I ) intend to sweep our remaining cash into this each month so its something I definitely want to check before using

latecomer

Matt_The_Chippy wrote: »

I've just seen this thread and wanted to add my tuppence to things.

I'm with Santander on their Offset mortgage 2.99% over base rate (3.49%).

thats great until the bank base rate hits 5+% and then its not so attractive. Ok there is no guarantee when rates will go up but its got to happen eventually.

Fixed offset rates are higher than variable ones and generally shorter than fixed rates - very few 5 year fixed rate offset mortgages from what I saw when I was looking.

Hence a low rate 5 year fixed with an accessible offset fund is for me a much better bet. Ok its got limits on overpaying but it should be plenty for us.