Offset Mortgage
An Offset mortgage will allow the balance of your current or savings accounts to be offset against your mortgage loan, thus reducing the amount of interest you pay on your mortgage. This means that if you have a mortgage loan of say £100,000 and you have £10,000 in your current or savings accounts, then you will only pay interest on £90,000. This will enable you to pay off your mortgage loan quickly and save you thousands of pounds in interest payments. Most Offset mortgage lenders are generally quite flexible, and will allow you to make overpayments on your mortgage, but some will even allow you underpayments. In an offset mortgage the interest is calculated on a daily basis, so even if the money stays in the offset account for a short time, you will still save interest payments and reduce your mortgage debt significantly.

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