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Financial Conduct Authority, FCA reference No 587075.  Registered in England, company No 07714109.  Registered office 77 Woodcrest  Road Darlington DL3 8EE

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Offset Mortgages

Offset mortgages allow you to use any savings you have to reduce the amount of interest that you pay on your mortgage loan.  

Your mortgage and savings are linked within a single plan.  Instead of earning interest on the savings, you pay interest on that much less of your mortgage – it’s like earning interest at the mortgage rate and having no tax to pay on it.

Offsetting your savings in this way can help to save interest and help to shorten your mortgage term.  To get the most from an offset mortgage you need to have fairly healthy savings balances.  Otherwise you may be better taking another mortgage deal and making higher payments than the minimum that you are asked to pay.  That will reduce your mortgage term too!

Offsetting has other advantages too.  It can be particularly useful for the self employed, so that they can put aside extra profits in an offset savings account.  This means that the money is still available if it is needed for business purposes, but in the meantime it’s saving as much interest as if it had been used to reduce the mortgage balance.  It can also be useful for putting aside money for tax bills.

An offset mortgage keeps your investments and savings separate from the mortgage balance, so that you can see clearly how your finances stand.

Some offset mortgage lenders allow you to view your accounts and conduct transactions online.  You may even be able to have a current account within the same plan.

House key

The tax savings that you can achieve are effective right now – but be aware that the government may change the rules if this type of arrangement becomes too popular.

Be sure that you’re aware of the hidden costs and pitfalls before taking any mortgage.  Read our lenders’ costs  guide for more information.

As independent mortgage brokers we’re well placed to find the cheapest mortgage rates that fit your individual needs.

Don’t forget, too, that a mortgage loan is probably the biggest commitment you’ll take on, so you need advice on how to make sure that the dream doesn’t turn into a nightmare.

To get on with finding the best mortgage deals for you, just contact us to discuss your needs.

Your home may be repossessed if you do not keep up repayments on your mortgage

Our typical mortgage advice fee is 0.5% of the amount borrowed.  This depends on individual circumstances