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Offset Mortgages -- the Numbers
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I'm a she not a he! !!!
Bet you can find a guy to help you spend all that money so it doesn't have to go for boring things like paying off a mortgage.I have five stars! This doesn't mean that I know anything about any of the things I post. I could be a raving lunatic, or a brilliant genius, or just some guy on the internet. In fact, I could be all three at the same time.
If anything I say makes sense, then do it. If not, don't. Don't blame me or my stars if you do something stupid because I suggested it. I'm responsible for my own stupidity only. You are responsible for yours.
Why, I don't even have five stars anymore! Aren't you glad you aren't responsible for my stupidity?0 -
;D ;D ;D
Bet you can find a guy to help you spend all that money so it doesn't have to go for boring things like paying off a mortgage.
Is that an offer?
J_B - just a thought, when you said you got £15k from credit cards in a month, was that in cash or was it for purchases? I thought CC worked on purchases, so I couldn't really use it towards offsetting the interest.0 -
Do not try this before you get your mortgage.
If your credit is good you can obtain 0% credit card deals and balance transfer funds without transaction penalties into current accounts.
Many credit card companies do not allow this direct route so you have to balance transfer to a card that does. Egg, Mint and MBNA are very flexible money pipes and pretty good deals especially during introductory periods. Its all here thanks to Martin:-
http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1076883546,34894,0 -
Is that an offer?
Well, errrmmmm. :-/
Yes, if you send me some money, I'll help you spend it by taking my wife on holiday. ;D
Yes, you can borrow money on 0% credit cards, put it on a flexible mortgage, and then borrow it back when the 0% period is up. Or even transfer it to another 0% card.
Some flexible mortgages don't allow you to borrow back once the balance is below £25K or so, so watch out for that -- you don't want to get a lot of borrowing on 0% cards, then have the introductory period run out and be charged 18% interest or something like that. :PI have five stars! This doesn't mean that I know anything about any of the things I post. I could be a raving lunatic, or a brilliant genius, or just some guy on the internet. In fact, I could be all three at the same time.
If anything I say makes sense, then do it. If not, don't. Don't blame me or my stars if you do something stupid because I suggested it. I'm responsible for my own stupidity only. You are responsible for yours.
Why, I don't even have five stars anymore! Aren't you glad you aren't responsible for my stupidity?0 -
???
I have an"offset mortgage" offer from Yorkshire bank. rate at the moment is 5.45% but is variable. We have very few savings (5k) but need a facility to borrow money against the house to pay school fees on a regular basis. Mortagae is aprox 200K and rising with 3k income going thru cheque a/c monthly. Currently with Bank of Scotland at a 5.5%rate with a facility to borrow more at this rate when nesc. Any help with the numbers would be appreciated.0 -
@Hatties_mate
Your post is buried here. Why not repost in a thread of your own in the main forum with a catchy title that describes your situation. If an offset is all you can get then so be it. They are not the best value if you have little savings in relation to what you borrow.
Nobody is helping you here so you have nothing to lose by reposting. More financial details will be required to help those with the knowledge. Otherwise they will say contact a mortgage broker.0 -
In simple terms what is an offset mortgage?This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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Hi Judi,
An offset mortgage is one where you have 2 account - one for the mortgage and one for savings (and possibly others as well but let's keep it simple).
Basically you pay interest on the difference.
For exmaple if you have a £100K mortgage and £20K savings then you pay interest on an £80K mortgage.
This is advantageous because you pay NO TAX on your savings.
However you have to balance this against the fact that the mortgage rates are higher than the cheapest discount/tracker mortgage.
Calculations have shown that you need about 50% of you loan as savings to benefit compared with getting the cheapest discount mortgage (note this is a very general figure and depends on a number of factors - but gives you a ball park).
There are also current account mortgages.
These are similar but basically everything is in one account rather than several.
This has the advantage that even your monthly salary can be saving you a few pennies in interest until you spend it.
The psychological downside is that you have a large negative balance, but essentially they do the same as offset mortgages.
Hope that helps and was simple enough0 -
Yes thanks, i understand.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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Reading thru all this has totally lost me.... We have a "off-set" mortgage with IF and we have just had a letter to say the interest has gone up to 5.95% so we thought we may be able to look for a cheaper deal or something... then we found this! We currently pay 436.42 a month but we pay £500 a month to reduce the mortgage quicker. We have a mortgage of approx. 57k left and we have 20k in the current account which is being off-set against it.... Are we on a good deal or not?
Like I said I am totally confused with everything that has been said on here... Are off-set morgages good or not... Could we get a better deal?0
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