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Offset Mortgages – Existing customers
Only available to existing Offset Mortgage customers
Making changes to your existing Offset Mortgage
Offset Mortgages are no longer on sale to new customers. If you have an existing Offset Mortgage, certain changes are still allowed. If you want to make any changes you’ll need to give us a call. As your Offset is interest only, you’ll need to let us know how you plan to repay your mortgage balance. It’s important that you fully review your Repayment Plan, and make any adjustments, to make sure you’re on track to repay your mortgage in full at the end of the term.
To help you understand the options that might be available to you, please take a look at the Financial Conduct Authority’s information sheet www.fca.org.uk/publication/documents/interest-only-mortgages-act-now.pdf
Note: Repayment plans won’t be acceptable if they’re jointly held with other parties who aren’t also party to the mortgage. First direct can’t give advice in relation to the suitability of any repayment plan.
Our Offset Mortgage takes into account other money you have with us when working out your interest payments. So every pound that’s in an eligible savings or current account with us, is one less pound you pay mortgage interest on. Say you have a £100,000 mortgage, savings of £20,000 and a current account with £1,000 in it. You only pay interest on the difference between the money you have and the money you owe – which in this case is £79,000.
Use your savings to reduce your interest payments
Offset Mortgages are interest only mortgages, which means you’re responsible for paying off the capital. You need to show you have a repayment plan in place to achieve this – it could be an endowment policy, an investment or another savings plan.
Key features
- as of 3rd April 2023, Offset Mortgages are only available to existing Offset Mortgage customers
- use your savings to reduce your interest payments
- this is an interest only mortgage
- you can make unlimited overpayments whenever you like – but Early Repayment Charges may apply
- if you repay any of the capital during the mortgage, you can redraw it whenever you like – but this will obviously increase your interest payments and could increase the time it takes to pay it off.
Things to bear in mind
- Early Repayment Charges may apply depending on your interest rate or if you pay it all off early
- the value of tax benefits will depend on your individual circumstances and tax rules may change in the future
- you can redraw any capital you’ve paid off, but you must make sure you can still repay the outstanding capital by the end of the mortgage term
- any borrowing linked to your Offset Mortgage will be secured against your property.
† Lines are open Mon to Sat 8am to 8pm and Sun 9am to 8pm.
Find the mortgage for you
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