Stoozing with offset mortgage

bradders72_2

I saw Martin Lewis on GMTV this morning and was talking about stoozing. He briefly mentioned how one person managed to pay off his mortgage using stoozing credit cards with an offset mortgage rather than with a savings account. Can anyone explain how this might work? Thanks.

tinkerbell84

There's a thread on the stoozing board about it.

Very clever, but you have to be organised!

bradders72_2

in the forum or on the main site? thanks.

tinkerbell84

bradders72 wrote: »

in the forum or on the main site? thanks.

forum. :A

bradders72_2

can't find it.....can you post a link to it.... :mad: :mad:

tinkerbell84

http://forums.moneysavingexpert.com/showthread.html?t=714521

CannyJock

You should also read all the guides on it before diving in - and be aware of the risks and how it affects your credit rating.

Start with the stoozing intro at: http://www.stoozing.com/g_stooz.htm
Then onto the risks: http://www.stoozing.com/risks.htm
And then follow up with the article on stoozing and offset mortgages: http://www.stoozing.com/g_offset.htm

It does work. There are a few of us who still technically have a mortgage but it's 100% offset. Basically you're not paying any interest on it, so all of the normal monthly repayments go against the capital - net result you repay it years earlier. You could always clear the mortgage at any time but I set mine up to repay my mortgage directly from my offset account (offset a/c balance = Outstanding mortgage amount + 1 month repayment).

That way I have instant access to funds if I really needed it without applying for a loan (which as a full-on stoozer there's every chance I'd be refused). I've also got a theory that having a low balance on a mortgage and showing a perfect payment history actually helps your credit score, but that's a home-spun theory with no facts to back it

snarffie

Martin Lewis' statement applies to only a small number of stoozers.

The problem is that if you don't earn a great salary, then you are restricted to how much credit you can get, which means that you are unlikely to offset a mortgage 100%, unless your mortgage is very small too.

For example, if your salary is £25k pa., then you are unlikely to get a stooz pot of much more than £25k. This would only offset 16% of a £150k mortgage. It helps, but is a long way off from paying the mortgage.

I have been stoozing for many years and it helped me to 1)Get out of debt (snowballing) and 2)Make £1,000's in interest, so I don't knock it, but it's no silver bullet to paying off the mortgage unless you have a small mortgage or a big salary (both would be preferable!).