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Offset mortgages are designed to let you take advantage of your savings without having to irretrievably pay them into your mortgage. Any savings you have are held against your debt, meaning that you only pay interest on the difference between your mortgage amount and your savings, for example if you had a £200,000 mortgage, with £50,000 in savings, you would only pay interest on £150,000 of the remaining mortgage balance.
Offset mortgages are not quite the same as current account mortgages, as your mortgage and savings are held in separate pots. This means that you can keep your savings in certain savings vehicles (most notably ISAs) and keep benefits like tax free savings, leaving your savings intact when the mortgage is paid off. The main downside to offset mortgages however is that they often have slightly higher interest rates than traditional mortgages. As always it’s worth analysing the savings to be made very carefully.
Read our comprehensive guide to learn more about offset mortgages.