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Who would you listen to for offset mortgage advice? Your bank? The TV? The newspaper? The Internet? – The best way to find out who to talk to is by asking other offset mortgage borrowers themselves.

It’s harder than ever to believe the banks these days – if they are not taking your taxes they are trying to sell you every financial product under the sun when you walk into a branch. The staff look like they should be at school and what’s on offer often looks less than competitive. When it comes to offset mortgage advice, your bank might not feel like it helps at all.

The media is no better. One week they are harping on about how great one product is, the next they are reporting on a mis-selling scandal. Everything is exciting news, and nothing is believable – you can’t be sure if the media is telling you the truth or spinning you a story.

Of course, there is the Internet. On the Internet there is a wealth of knowledge and access to just about every financial product there is. But who can you trust? The Internet is faceless and can feel decidedly unsafe when you are investigating financial products. It can be a great source of good information, but it can also be a breeding ground for scams and cowboys.

So who can you trust for offset mortgage advice?

Ask people who have been through the process before: http://www.offsetmortgagecentre.co.uk/customer-feedback.html. These are all offset mortgage borrowers and are all now saving more money thanks to their innovative loans – and they all went to a professional offset mortgage adviser for advice. If they trusted a good adviser, why don’t you?

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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Rising inflation coupled with a historically low base rate of 0.5 per cent has left consumers with very few opportunities to gain any real return on their savings – but for those savers who also have a mortgage, now could prove the perfect time to consider switching to an offset mortgage deal as a way of providing an alternative to poor paying savings accounts.

According to Moneysupermarket.com, customers taking out a £100,000 offset loan at 3.49% and holding £30,000 in a linked savings account would only pay interest on the remaining £70,000, saving £11,648.51 over the lifespan of the mortgage, and would knock five years off the payment term also.

It says to be able to match this deal, savers would need to find a savings rate of at least 4.5% for basic rate taxpayers, rising to 6% for higher rates taxpayers. None of the 264 UK easy access savings accounts currently pays a high enough rate.

Hannah Mercedes-Skenfield, mortgage channel manager at moneysupermarket.com, says: “It is becoming almost impossible to find an account which offers a real return on your savings. As a result, the advantages of an offset mortgage are becoming more attractive to borrowers who also have a decent savings pot.

“At times like these, when interest earned on savings after tax is potentially lower than the interest consumers pay on their debt, offsetting can be a great option. There is an additional benefit for taxpayers, as you don’t earn interest on the savings, you won’t be taxed on them either. This is even more of a benefit to higher rate taxpayers.”

SOURCE: Moneysupermarket.com, 15/03/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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Many savings rates have tumbled over the last few months as lenders try and offer cheaper mortgages – with an offset you can have the best of both worlds.

At the moment, in order to maintain their balance sheets, banks can either offer competitive mortgage or saving deals, not both. And according to Moneyfacts, since November 2009 mortgage rates have been reducing, but in order to fund these cuts savings rates have fallen too.

Michelle Slade at Moneyfacts says: “Providers have moved their focus to the more profitable mortgage market, with savings rates being reduced to fund mortgage cuts and those who really on their savings to supplement their income being hardest hit.
 
“It is already virtually impossible for savers to find an account paying a positive real return after tax and inflation and falling rates are only going to exacerbate the situation.”
 
With an offset mortgage you can have it all – you can save money each month and you can have a cheap mortgage rate. Because with offset you don’t need to worry about cheap savings rates, you save money by reducing your mortgage rate each month through increased savings.

So if you are sick of looking for the impossible combination of high savings rates and low mortgage rates, talk to an offset expert about taking out a loan that saves you money while also giving you a low rate of mortgage repayment, giving you everything that you need.

SOURCE: Moneyfacts, 09/03/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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The way most mortgages work is pretty straight forward – you take out a loan with a mortgage lender and over time you repay that loan at a premium. But offset mortgages do not quite work in the same way.

Regular mortgages are secured loans which means they are a money loan secured on a home. That’s why it is quite cheap to borrow hundreds of thousands of pounds – a lender will give someone a loan for 3% or 4% because they know that should that borrow stop paying the mortgage, they can simply take the security, the home, and be reimbursed.

Offset mortgages use this idea and twist it, creating the strangest mortgages in the UK – mortgages that actually help people save money.

Because offset uses that idea of security and builds on it. With an offset mortgage, you secure lump sums of cash alongside the property, in affect making you a safer borrower because the lender knows that should you stop paying your mortgage then there is a property AND a cash lump sum to take back from. So they are happy to offer a cheaper rate, thanks to that added security.

And the more security you amass against the debt, the cheaper the loan becomes.

So if you keep increasing that lump sum, month by month, the rate at which you have to pay back your loan becomes cheaper and cheaper – thus offset is the only mortgage that can save you money each month.

Talk to an offset mortgage adviser about using your savings for more than just the tiny returns they are making right now – invest your home and your money into the strangest and most rewarding mortgage in the UK.

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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More young adults are struggling to get jobs and make ends meet, so they are having to rely on their parents more than ever for support. This can be a real burden on parents – but it needn’t be with an offset mortgage.

According to research from Scottish Widows, adult children are continuing to ‘sap’ their parents’ savings and investments and while the average amount being handed out has increased significantly, the number of parents able to give has fallen. 

Almost half of parents with children over 16 have given or loaned money to their adult children or grandchildren – the average amount given to struggling kids is £13,660, up from £11,800 last year, proof that those parents who are able to give are being forced to give more as their children struggle.

The immediate effect the saving sap fund has had on parents is also alarming – 82% of parents who gave money to family members had to dip into their savings to do so, and worryingly 54% of these do not think they will be able to top that back up.

Iain McGowan, savings expert at Scottish Widows says: “Fewer parents can afford to give or loan money, while those who can, are being asked to provide more. Parents will not only be extremely vulnerable to any unforeseeable circumstances, but the extra handouts to their kids can also affect them in retirement, meaning they may have to work longer, or make their retirement savings stretch further. The earlier parents and children get into the habit of saving the better.”

If you have an offset mortgage, you can take out the lump sum saved against it whenever you need it. It won’t make you more indebted but it will only increase your mortgage rate by a small amount each month. But crucially you will be able to help your kids and keep yourself safe at the same time.

SOURCE: Scottish Widows, 03/03/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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It’s all well and good a mortgage adviser telling you to switch to an offset mortgage but until you release how much you can actually save by just moving around your money you may not be entirely convinced.

Offset mortgages work by taking a lump sum and offsetting it against your mortgage debt – £10,000 offset against a £150,000 mortgage would mean that you only have to pay the interest on £140,000 of the debt, for example.

And that’s a big saving – for example, if you took out a £150,000 offset lifetime tracker deal at 2.39% and made sure to have £10,000 in the offset savings account for the life of the loan then you would save a total of £3,418.

Compare that with £10,000 in a savings account where the rate of interest is less than 1% then it makes sense to go with an offset. Also, interest accrued in a savings account is taxed, but any money saved in an offset is tax free – that’s even more savings.

But that’s not all – in the previous example, not only would you make nearly £3,500 but you would also reduce the life of the mortgage by 1.6 years. So not only can you save more money with an offset mortgage, but you can also reduce the amount of debt you have in your life.

There are so many more benefits to offsetting your money against your mortgage, so ask a professional offset mortgage adviser about some more figures that make offset make sense.

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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Most people have to get serious about saving money at some point – do it sooner rather than later with an offset mortgage.

Saving money each month allows you to build up a nest egg, gives you a better credit score and gives you a better chance of getting hold of better credit in the future – so the sooner you can begin saving the sooner you can become a better borrower.

It seems as though some people are realising this – the average age for Britons to start saving seriously is 25 years-old, according to new data from National Savings and Investments.

But there are still some people who are simply not able or not willing to save money – more than a fifth of the population say they didn’t start setting money aside in earnest until they were past their 30th birthday, while more than one in ten fail to seriously save until they are 40 years or older. Worryingly, 15% confessed that they had actually never saved at all.

But people are waking up to the benefits of saving thanks to the recent financial crisis. NS&I says one of the main reasons people get serious about saving is after reading stories about how others, without savings, have suffered in an emergency and a third confessed that it was when they suffered a financial shock personally that they began their savings habit. Others began after seeing their parents worrying about not having enough money now and in the future.

It doesn’t matter why you decide to start saving, the important thing is how you do it and how serious you are about putting money aside each month. By using an offset, you are incentivised to save with a reduced mortgage payment each month – so the more you save, the less you pay.

NS&I says: “We’re urging Britons to review their future financial needs and to develop the habit of saving.”

SOURCE: NS&I, 24/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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The old adage that ‘if you look after the pennies the pounds will take care of themselves’ may not be true in the 21st century but the message is worth bearing in mind as Brits look for other ways to make their money work for them.

With instant access savings accounts now paying an average of just under 0.75% according to the latest research from moneynet.co.uk, it’s important for consumers to explore alternative savings products in an effort to get a half decent return on their cash.

There are better rates available if you’re prepared to consider putting a regular sum of cash away on a monthly basis. Whilst it may seem like too much hassle, in reality it’s pretty straightforward and a few minutes work can see you handsomely rewarded each month. One of the best vehicles to put the cash in is an offset mortgage – the more you save into the mortgage, the less you pay.

It’s easy to use as well – a good offset mortgage broker will help you link any number of instant or fixed savings accounts or ISAs into the mortgage. So you do not even need to change all your finances to be able to make the most of offset.

If you can save a little each month, maybe £100 or more, it all adds up – on top of your existing savings that extra cash will go towards reducing the rate of your mortgage. By the end of the year you will have found that a chunk of your original repayment rate will have disappeared and your outgoings will have shrunk. Of course if you keep up with the original repayments then you will overpay into your mortgage and will reduce your rate by even more.

Offset works best when it is constantly managed. That isn’t always an easy task and it needs the guidance of a professional offset mortgage adviser, but it is possible and many people in the UK can tell you that it does work.

SOURCE: Moneynet.co.uk, 23/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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If you do not feel like you control your own finances and feel like they are in control of you then you need to invest in a mortgage where you are the boss and you call the shots, every month.

It’s a common dilemma to be in – more than half of Britons aged 35 and 45 do not feel fully in control of their finances, according to a new survey commissioned by F&C Investments.

The study found that overall, just under 50% said they felt in control of their finances, with a little over 36% saying they felt a degree of control and 14% saying they did not feel at all in control.

Almost a third of respondents with borrowings were either a little worried about their level of debt or were actually finding it hard to keep up repayments. However, nationwide more than half of respondents had either no borrowings at all, or none apart from their mortgage. Interestingly, almost a third have enough ‘rainy day’ cash on deposit to fund several months’ outgoings.

Scott Stevens, head of global wholesale and marketing at F&C Investments, says: “While some of the results of this survey are encouraging, there is a real need for people in this age group to sort their financial lives out.”

With a flexible offset mortgage, the ball is always in your court. You can decide how much you can afford to save each month, how much to pay and how much money you need to take from your property. Of course, you have to work within the guidelines of the mortgage and within the advice of a good mortgage adviser, but a flexible mortgage does what it says on the tin – it fits around you.

So take control of your finances – make sure you are the boss of your debt, your savings and your outgoings each month by tailoring a flexible offset mortgage around your needs.

SOURCE: F&C, 18/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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New research by The Co-operative Bank Mortgages has revealed that almost two thirds of mortgage holders are aiming to be mortgage-free by the time they reach 50 years of age. 

This is a great goal, but one that is tough to make a reality. To do it you need a mortgage that encourages overpayment and actually gets cheaper the more you invest into it – you need an offset mortgage.

To be mortgage-free would be a wonderful thing – the bank found that over half of people would take more holidays, just under a third of people would turn their attention to saving more for retirement and a quarter of people would look to change their working lives by either finishing work or moving to part time hours.

And people are doing it already. Many have been making mortgage overpayments to reduce the term of the mortgage over the last year. Other people are looking to take advantage of the low interest rate environment, and some are looking to have more disposable income as a result of reductions in their mortgage rate. Ask your mortgage adviser about how well their offset mortgage clients are doing right now for an idea of the benefits overpayment can make to your life.

James Hillon, head of mortgages at The Co-operative Bank says: “The research clearly shows that many mortgage holders are looking to take advantage of the low interest rate environment by making overpayments.”

With an offset mortgage, because you can make overpayments and because you can reduce your rate by doing so, it pays to be in a low rate environment and it pays to overpay. It’s exponential as well, because the more you save the cheaper your mortgage rate and the more you have in your pocket at the end of the month, so you have the means to save even more the next month, and the next.

Talk to an offset mortgage adviser about a loan that will help you become mortgage-free. It might seem like a long way off when you are trying to manage a six-figure debt, but with hard work and good advice you can get rid of that responsibility and begin to spend your money on what you want.

SOURCE: Co-Operative Bank, 15/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.