The One Account?

jamesd

wymondham, for an approximate calculation you'd enter the total outstanding mortgage balance each month and calculate the interest each month on that balance at the mortgage interest rate. Then a second column for the interest rate of the other mortgage so you can compare the two.

You're overpaying at a very high rate - more than half of the mortgage paid off in a year - so the extra interest you're paying won't have very many years to add up. It's not going to cost you a huge amount more because of this very fast repayment. Different story if you were doing it over nine years.

Only approximate because interest is daily but since both mortgages will use daily interest the difference isn't very significant.

SALTY69

Thanks wymondham, I have had a look at all the replys and it seems the Majority like it, I will add up the pro's and Con's and will decide what to do, but i must admit the amount of cash we will have freed up we will have about £500 over so it is a good option but will ask about other options as well just in case. It is important to realize that people manage money differently to others so i suppose really to get a view right across the board is a good thing, Martin seems not to keen on this account but there again, it is a case of circumstances i suppose.

SALTY69

wymondham

SALTY69 wrote: »

Thanks wymondham, I have had a look at all the replys and it seems the Majority like it, I will add up the pro's and Con's and will decide what to do, but i must admit the amount of cash we will have freed up we will have about £500 over so it is a good option but will ask about other options as well just in case. It is important to realize that people manage money differently to others so i suppose really to get a view right across the board is a good thing, Martin seems not to keen on this account but there again, it is a case of circumstances i suppose.

good luck - let me know what you decide!

SALTY69

jamesd wrote: »

Steer clear in your case. The One Account flexibility is best for people who are putting in and taking out a high percentage of their mortgage each month. Your plan is to overpay regularly, not put in and take out say 50% of the mortgage each month.

For your plan a lower interest rate flexible mortgage is fine, since that lets you overpay regularly or with lump sums and from time to time take out some of the overpaid money if desired.

If you think you'd more regularly want to take out the money overpaid, an offset mortgage would be the next option. The savings account here lets you regularly put in and take out money, just like a normal savings account.

The One Account and other current account mortgages only really strongly come into their own when it's for regular in and out in the same month.

For those with irregular work a cheaper alternative to the One Account is an offset mortgage for say 20k more than needed, then immediately deposit the 20k extra into the offset account. No interest to pay on it but if you hit a poor work patch it's there to be drawn from.

All of these options let you save interest by overpaying if you like. But without the very high interest rate of the One Account. One caution with interest saved calculations: because the One Account interest rate is so high, that also means that its calculated savings are also higher than for cheaper mortgages. Don't look at the interest saved number. Look at the total you still have to pay: that's what's coming out of your pocket!

Given the fairly low mortgage amount you can usefully look for a lifetime tracker mortgage so you won't need to remortgage again before the mortgage ends. You're now at the point where remortgaging costs can be significant and are best avoided.

Martin is correct to recommend against the One Account. It's almost always possible to do better.

wymondham, skim, bunking_off, FreedomGirl, chickadee, just for fun, try working out what you'd have paid if you made exactly the same payments into a competitive offset mortgage offset account. I'm curious about just how much more the One Account has cost you so far. If you're using the flexibility to not make any payments, or paying 50% into the account and taking 50% out each month, no reason to do this: you're using the flexibility so it may well be suitable for you regardless of the interest rate cost.

Hi Jamesd, I am taking £40000 over 10 years, But hoping to pay this off over 5 Years paying off £500 per month it has changed slightly since my first post. Do you know of any other accounts which would suite me? ie: give me a mortgage over that time but let me pay overpayments of £500 pm? I also receive £20000 lump sump from a pension in 5 years!

Cheers Salty69

SALTY69

wymondham wrote: »

good luck - let me know what you decide!

Yea will do at my time of life it,s a case of making sure as as you get older the options get less!

DickDastardly_2

I have the Virgin One Account and agree with most of what's been said above. It is harder to operate than a 'normal' account BUT without it I think we would have gone un der a long time back as I am self-employed and we can effectively 'borrow' from future earnings, although this is a scarier way to live than I would reccomend!!

The only thing I would say is go to the VIRGIN One Account. For a start itis the original and secondly their customer service is superb. I would not touch NatWest with a barge pole - I think they have a terrible attitude with their customers and their staff (my wife is an ex-employee of RBS who now own Natwest).

The accounts so far as I can see are the same (as they would be as Virgin is part of RBS as is NatWest) but the customer service teams are different, Virgin retained its identity, staff and offices post-merger.

Good luck!

SALTY69

DickDastardly wrote: »

I have the Virgin One Account and agree with most of what's been said above. It is harder to operate than a 'normal' account BUT without it I think we would have gone un der a long time back as I am self-employed and we can effectively 'borrow' from future earnings, although this is a scarier way to live than I would reccomend!!

The only thing I would say is go to the VIRGIN One Account. For a start itis the original and secondly their customer service is superb. I would not touch NatWest with a barge pole - I think they have a terrible attitude with their customers and their staff (my wife is an ex-employee of RBS who now own Natwest).

The accounts so far as I can see are the same (as they would be as Virgin is part of RBS as is NatWest) but the customer service teams are different, Virgin retained its identity, staff and offices post-merger.

Good luck!

Thanks !!!!!!, Interesting one yours as i must admit i found the Natwest staff excellent to deal with, you want to try HSBC sometime can be a nightmare. I will take a look at Virgin thanks for your help.

salty69

wymondham

I thought Virgin One and The One Account (AKA RBS) are one and the same??

Did'nt RBS take over this account from Virgin??

NatWest have this package as they come under the RBS unbrella, but it is still the same One Account (not NatWest). I'm sure they have the same excellent staff based in Sunny Norwich!

minimoocow

Hi all,

Agree with the comments made so far - it really does depend on you. It has worked well for us so far and the flexibility is great but the rate isn't. We would have done better having a 3 yr fixed rate and overpaying into a high interest account and then paying the mortage off at the end of the term.

That said we will probably pay off the mortgage a month later with the one account than the fixed rate route (on the same figures) so I'm not too bothered - I see it as the "charge" for better service etc and it was very cheap to transfer.

If you do go for it make sure you take time to work out the internet banking side of things - I didn't find it as easy as it suggested it would be and I am very financially minded. My OH hasn't even looked at it!!!! It will take a good couple of hours but it is worth it when you get there.

HTH

MMC

SALTY69

minimoocow wrote: »

I see it as the "charge" for better service etc and it was very cheap to transfer.

HTH

MMC

Hi MMC, Just how cheap was it to transfer? Thanks for your Comments.

salty69