offset flexible mortgage

A

anatasha

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Can anyone give insights as to what this option is about.The only information i have is that it is somehow determined by the amount of balance you have in your bank at the start of the month.Any info will be appreciated esp pros and cons
Thanks!
 
anatasha,

Does your question realate to a particular First Active product or to Offset Flexible Mortgages in general?

aj

I know that many providers offer this type of product in the UK, are there other providers here in Ireland?

I think that that a significant disadvantage with this type of mortgage is that the interest rates are higher than the equivalent tracker or svr.
 
They can also be tax-efficient if you pay tax on your savings. This is because you do not earn any interest on your savings and so don't pay any tax on them. Instead you pay less interest on your mortgage. This amount is usually greater than the interest you would have earned after tax on your savings, if they were not offset against your mortgage. This benefit is greater if you are a higher rate taxpayer.
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I thought that DIRT satisfied your tax obligations - therefore the benefit would be the same for a higher rate taxpayer ???
 
Thanks for all the replies....
...will definitely need to consider the option,wonder why more people dont opt for it??Is there a catch?.I have a huge tracker mortgage, but some money in savings...maybe the reduced monthly interest to be paid on the mortgage will balance out with the higher APR on the mortgage itself. if i go with the offset option.if that makes sense at all...maybe i got it all wrong.
 
i have an offset with 1st active. I think it works well but im wondering about rising interest rates. I think they may go alot higher. With the offset you are on the variable rate. Are you better off goin back to fixed rate standard mortgage if you believe rates are on the rise , would anyone think of doin that? apologies for being as clear as mud:)
 
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