Offset Mortgages

Lenders will offer you schemes whereby your mortgage, savings and current account are held together in”One Basket”. The mortgage interest is applied to the total balance on a day to day basis so the more savings you have the lower amount of interest is charged thus reducing the number of years you repay your mortgage.

Cashback Mortgages

These are usually linked to a lender’s Standard variable rate and provide a cashback on completion of the mortgage equivalent to a percentage of the mortgage advance. To prevent a borrower receiving the cashback and then moving to another rate the lender will insist on a “tie in” period dependant on the size of payout.

Capital & Interest Repayment Mortgage

This is the most common form of repaying your mortgage. Each month with every payment made to the lender you are paying the interest and part of the capital so at the end of the chosen term the mortgage would have been repaid.

Endowment / ISA Mortgage

Each month you only pay the lender the interest on the mortgage with the capital repaid at the end of the chosen term. The repayment of the balance is then covered by the maturity of any endowment or investment plan set up, therefore you are relying on the performance of these separate plans to repay the mortgage.

Interest Only Mortgages

Each month the interest on the mortgage is paid to the lender with the balance remaining unaltered. This will remain for as long as the mortgage remains or until it is paid off, for example through the sale of the property.