Fully Offset Mortgage - Interest

quaium

[FONT=&quot]Just wondering if someone could help with this...[/FONT]
[FONT=&quot] [/FONT]
[FONT=&quot]I currently have an offset mortgage with Barclays at a rate of 1.98%. Now I have fully offset that mortgage with savings. The offset started in May, however when I view my mortgage balance every day the amount is going up by around £6 per day.[/FONT]
[FONT=&quot] [/FONT]
[FONT=&quot]Can anyone explain this? I am going to talk to Barclays about it but I wanted to be clearer on it before I do. When I took out the mortgage I was told if I am fully offset then no interest would be charged. Now £6 per day adds up to around £180 per month which is quite a bit in my opinion.[/FONT]
[FONT=&quot] [/FONT]
[FONT=&quot]Any advice would be appreciated.[/FONT]

getmore4less

On my offset barclays only add the interest at the end off the month.
(payment come off on the 16)

Check the statements.

quaium

getmore4less wrote: »

On my offset barclays only add the interest at the end off the month.
(payment come off on the 16)

Check the statements.

Is your mortage fully offset?

getmore4less

Has been, zero interest added those months.

Check you have your offset accounts actually offset and not using any reserve.

AnotherJoe

quaium wrote: »

[FONT=&quot]Just wondering if someone could help with this...[/FONT]

[FONT=&quot]I currently have an offset mortgage with Barclays at a rate of 1.98%. Now I have fully offset that mortgage with savings. The offset started in May, however when I view my mortgage balance every day the amount is going up by around £6 per day.[/FONT]

[FONT=&quot]Can anyone explain this? I am going to talk to Barclays about it but I wanted to be clearer on it before I do. When I took out the mortgage I was told if I am fully offset then no interest would be charged. Now £6 per day adds up to around £180 per month which is quite a bit in my opinion.[/FONT]

[FONT=&quot]Any advice would be appreciated.[/FONT]

It is, and something very weird is going on which you'll have to get them to sort. Do post back.

Thrugelmir

How does the offset account work? Is the interest earnt on the offset credited to your mortgage account once a month?

The interest being charged of £6 could simply be the daily accrual. The system won't be as sophisticated as to control the balances daily.

quaium

Thrugelmir wrote: »

How does the offset account work? Is the interest earnt on the offset credited to your mortgage account once a month?

The interest being charged of £6 could simply be the daily accrual. The system won't be as sophisticated as to control the balances daily.

I have a savings account linked to the offset mortgage. The savings account is also with Barclays.

I'm just concerned why the £6 is being added to my mortgage balance. That shouldn't change at all let alone going up every day.

I'm worried if when I call Barclays tomorrow they aren't going to give me a straight answer or even have a clue. Who do I turn to if I don't get a straight answer from them?

silvercar

If you aren’t satisfied with their response you raise a complaint. That gets your complaint looked at by higher level staff within the bank.

minimike2

A quick google search reveals the brochure, which contains this:

"What will I pay in the month after
my mortgage completes?
In the first full month after your mortgage
completes, the payment you will have to make
is a full contractual monthly payment plus any
mortgage interest carried forward from the
month when your mortgage completed.
Your first monthly payment will be reduced by the
Offset Benefit you have earned by the end of the
month when your mortgage completes. This is
because each monthly payment is reduced by
the amount of Offset Benefit that you have earned
in the previous month.
What will I pay each month thereafter?
Each of the following monthly payments will be
reduced by the Offset Benefit earned during the
previous month. If the total balance held in your
offset accounts fluctuates during the month, this
will be reflected in the following month’s payment."

getmore4less

That is only one of the option with Barclays offsets

They also allow
fixed payment same every month till a recalculation event.
payment can only go up but not down on a recalculation event


The OP should be getting monthly statements that show the actual daily balance and when the payments come off and interest gets added.

I don't even look at my on-line balance, with monthly paperwork no need.

getmore4less

Thrugelmir wrote: »

How does the offset account work? Is the interest earnt on the offset credited to your mortgage account once a month?

The interest being charged of £6 could simply be the daily accrual. The system won't be as sophisticated as to control the balances daily.

On mine interest is calculated daily on the net balance and added monthly.


If they used credits from saving that would be taxable income so no offset lender should be doing that.