Current Account Offset Mortgages

Your mortgage is combined with your current account or savings account. This means you can use the credit in your account to reduce your debt, and therefore pay less interest on your mortgage. For this type of mortgage, you should have savings of between 10 and 20% of your mortgage. You can choose between a fixed, variable or discount rate.

Pros:

• Offers the benefits of a flexible mortgage
• Saves you money by reducing your interest payments, and can ultimately cut the overall term of your mortgage
• Suitable for those with large savings

Cons:

• You will not receive any interest on your savings or current account
• These mortgages tend to be around 1% more expensive than others
• For the most benefit, you will need to manage your accounts closely