If you have savings, your cheapest mortgage option could be an offset.
If you are looking for the cheapest mortgage and have any savings, an offset mortgage could be the answer. Call Deal Direct for advice on the different types of mortgage available and the best rates on offer in the market.
With an offset mortgage, any savings you have are offset against your mortgage balance. You only pay interest on the difference between your mortgage amount and your savings balance. You will not earn interest or pay tax on your savings and you can still use them if you need to.
As your savings rise and fall the cost of an offset mortgage also changes. The savings you make on monthly payments can be used to reduce your payments or to pay part of the loan, which can also reduce the term. Because your savings may vary it can be more difficult to assess which is the cheapest mortgage when comparing offset rates to rates for other types of mortgage.
If for example you want a loan of £200,000 and you have a total balance of £20,000 in your savings to offset, your mortgage interest would be calculated on the balance of £180,000. This could save a lot of money from your interest payments but if needed your savings are still available.
For more information on offset mortgages or any other type of product call Deal Direct. Our experienced advisers can help you decide which type of product suits your situation and find you the cheapest mortgage rates on offer.
