How does the One account mortgage compare with others in the market?
As the name may suggest, the One account mortgage is part of an account that allows you to deal with all of your finances, including current account, loans and savings within one account. So how does this style of mortgage compare to the rest of the market?
One account mortgage customers organise their salaries to be paid direct into their account, which reduces the average daily balance on which interest is charged on their mortgage. The products are perhaps generally more comparable to offset type mortgages from other lenders. The main selling point of this type of mortgage is that it allows you to save on some of the interest charged and potentially pay off your mortgage earlier.
In the past the One account mortgage rates followed the Bank of England BR but as with many of the lenders, recently rates have been increasing in spite of the historically low base rate.
With the announcement of a quarter of a per cent increase in rates to 4 per cent, Royal Bank of Scotland and One account interest rates are similar to many standard variable rates we are now seeing. The rates vary slightly for One account customers depending on the agreed borrowing limit compared to the value of your home.
It has been reported that a range of alternative products will be available to an estimated 200,000 RBS and the One account mortgage customers, if they want to change products as a result of the rate rise. However the increase may mean that there are better deals in the wider market place.
Call Deal Direct and we can see if there is a better deal for you.
