Offset Mortgages

Welcome to the Offset Mortgages page, an offset mortgage allows you to reduce the interest that you pay on your mortgage and therefore allow you to pay off the mortgage more quickly and cheaply. An offset mortgage is a very modern mortgage that has many advantages and can save you allot of money if you have savings, this is because with an offset mortgage your savings are used when calculating the interest on your mortgage.

Top offset mortgage providers:

The One Account - use their free calculator to see how much you could save.

This can sound complex but it really isn't, for example if you owe £100,000 on your mortgage but have £20,000 in savings then you would only pay interest on the outstanding £80,000 with an offset mortgage which would save you allot of interest. You do not earn any interest on the savings but the money that you save makes this more than worth while as if the savings were in a standard savings account they would not produce the amount of interest that you would save with an offset mortgage.

Offset mortgages are also more flexible so you can pay off more should you choose to and the amount of savings that you have has a direct effect on your monthly mortgage repayments. It is especially prudent to have an offset mortgage when interest rates are low as your savings would not be incurring much interest anyway, it is still a good idea at any time though as your savings will work harder and produce more for when when offset against a mortgage.

The only way to get as good a return as an offset mortgage would be the more risky investments and this shows the power of an offset mortgage as there is no risk with an offset mortgage, your savings will not generate any interest but they certainly won't go down (assuming you leave them alone!) and it will mean that your mortgage repayments are reduced considerably over the life of the mortgage.