help understanding my offset mortgage please

westy69

Hi I currently owe £45000 and I have £45000 saved and its an offset mortgage, I have just come off a 2 year fixed deal onto the standard variable rate 4.74% I was previously paying the full amount to shorten the term which was approx £270 per month since going onto the SVR I have asked to just pay what is required to clear the mortgage and benefit from lower monthly payments.
now this is where I am confused, the payment has dropped to approx £130 per month which seems too low to me. I admit I don't fully understand offset mortgages my main aim is not to have to pay any interest which hopefully I am achieving but I cant understand how £130 per month will clear it as I took it out over 20 years can anyone help to explain this please?
The building society people have assured me the amount is correct and my interest on my savings is making up the difference but to me I thought the interest offset the mortgage interest so how can it do both?

thanks

somethingcorporate

I agree it doesn't look high enough.

I did nothing more than multiply £130 per month by 12 months = £1,560 and multiplied this by 18 years - your remaining term and get to £28,080.

Are you sure the mortgage was taken out of 20 years and not 30?

westy69

hi, yes definitely 20 years

westy69

sorted now thankyou it is the correct amount