advise please about what to do about mortgage

getmore4less

Thrugelmir wrote: »

There are 2 seperate transactions.

a) The monthly mortgage repayment
b) The monthly interest credited from the offset account.

So the question is. Can the offset balance exceed the outstanding mortgage balance?

If it works like that it would be taxable.

Thats not the way lenders should do offsets.

Barclays definately does it properly by adding the interest due on the net ballance to the account every month.

Thrugelmir

getmore4less wrote: »

If it works like that it would be taxable.

Thats not the way lenders should do offsets.

Barclays definately does it properly by adding the interest due on the net ballance to the account every month.

Would be difficult then to manage the offset balance to precisely equal the mortgage balance.

ViolaLass

Thrugelmir wrote: »

Would be difficult then to manage the offset balance to precisely equal the mortgage balance.

Why? If you equal them in one month, you may have to pay a small amount of interest to cover the days when they weren't equal. After that, there's no net difference so no interest to pay.

tightwadess

yes all the above comments are correct
the offset is not allowed to exceed the mortgage balance
the mortgage payment goes in on the fifteenth of the month the outstanding balance is usually amended the following day
the interest although calculated daily is for illustration purposes is amended and shown on the first day of the following month
so as its been said its quite difficult at the moment to know exactly what should or shouldn't be in the offset

tightwadess

ViolaLass wrote: »

Why? If you equal them in one month, you may have to pay a small amount of interest to cover the days when they weren't equal. After that, there's no net difference so no interest to pay.

i think this is the place where i need to get too so its gonna be a little bit of may be give and take with the pennies until as you say there is no more interest being deducted
i hope that's right anyway

getmore4less

Thrugelmir wrote: »

Would be difficult then to manage the offset balance to precisely equal the mortgage balance.

WHY, if 100% offset the interest added will be ZERO.

When the payment is made(if one is required) the same amount is moved from the offset accounts, or better pay from an offset account if that facility is available.

getmore4less

tightwadess wrote: »

yes all the above comments are correct
the offset is not allowed to exceed the mortgage balance
the mortgage payment goes in on the fifteenth of the month the outstanding balance is usually amended the following day
the interest although calculated daily is for illustration purposes is amended and shown on the first day of the following month
so as its been said its quite difficult at the moment to know exactly what should or shouldn't be in the offset

it be that the interest is calculated daily and added on the 1st of the month.

This is the way Barclays does it, payment day is 16th.

Daily mortgage ballance goes up on the 1st down on the 16th(or any other day a payment is made).

Make the offset ballance 100% offset on the 1st/2nd adjust on payment day by the same as the payment, it should only be pennies out on the next adding of interest.

tightwadess

getmore4less wrote: »

it be that the interest is calculated daily and added on the 1st of the month.

This is the way Barclays does it, payment day is 16th.

Daily mortgage ballance goes up on the 1st down on the 16th(or any other day a payment is made).

Make the offset ballance 100% offset on the 1st/2nd adjust on payment day by the same as the payment, it should only be pennies out on the next adding of interest.

thank you very much this is what i shall attempt to do
so roll on the first of Feb

tightwadess

i.d just like to thank you all for taking the time to read and answer my questions
your all very wise and kind

eldaniel

tightwadess wrote: »

the offset is not allowed to exceed the mortgage balance

For example, if my outstanding mortgage would be £3000 and I would have £4000 in my current account, which is offsetting mortgage. What would happen then? I don't think bank is allowed to take £3000 from my account to repay my mortgage completely.
I always believed that even if I would have £100000000000 pounds in my account and outstanding little mortgage, that still decision to repay it completely would be mine.