FSCS protection with offset mortgages 16 March 2019 at 9:31PM in Mortgage-free wannabe 2 replies 1.1K views

siliconvalley

Hello,

I'm considering an offset mortgage, does anyone have any information about what happens if your savings cross the FSCS threshold and the bank goes bust? Do you lose the difference or are you ultimately not at a loss should this situation arise?

Thanks.

miss_undastood

I believe you need to be under the 85k per person in savings to be covered.

I’m not 100% sure but this is what I believe applies and moneysupermarket seems to agree too see here/

siliconvalley

Contacted Coventry building society and got great advice (modified slightly to not reveal my personal finances)

The Financial Services Compensation Scheme covers individuals savings up to a maximum of 85,000 GBP. If you were to have savings above this limit, the surplus funds would then be taken from the mortgage debt as long as the mortgage is held with the same provider.

Your current mortgage product allows you to over pay by 10% of the balance brought forward on the 01 January each year. This means that until the 31 December this year you have the ability to make overpayments to the amount of XX,XXX GBP before any penalties may be charged. These over payments will be taken off the mortgage balance.