What is an Offset mortgage? How does it work? How can it be of benefit?
An Offset mortgage can be of particular benefit to anyone with savings in the bank, earning little or no interest or even someone who can put away as little as £100 each month.
The main benefit of an Offset mortgage is the interest saved over the term of the mortgage and also equally fantastic is the number of years you could reduce your mortgage by!
A typical £100k mortgage for example, could benefit from as little as £100per month in an Offset account and if this facility was utilised every month during the term, the savings could be as much as £21k in interest and a 4yr term reduction*
If linking any existing savings to your Offset mortgage you benefit from the interest reduction but you can still access your savings at any time for those life events or rainy-day needs.
It sounds simple and it really can be for anyone’s benefit.
When discussing your mortgage options with your Broker it pays to mention any savings or ability to save each month as this could make a Big difference to the biggest financial commitment you will ever have!
*subject to rates of interest and term of mortgage and other criteria