Jules S
Premium Member
Registered: 24th Dec 03
User status: Offline
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Just out of interest.....does anybody have one?
Any fall backs?
Just did a 'shrinker' thing on their website and it was quite a shocker 
Edit:
Try it...
http://www.natwest.com/microsites/personal/mortgage_shrinker/index.asp?referrer=furlshrinker
[Edited on 18-10-2007 by Jules S]
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RichR
Premium Member
Registered: 17th Oct 01
Location: Waterhouses, Staffordshire
User status: Offline
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Is there a set up charge; if it works I can shrink my mortgage term by 18 years! and save £87k!
there must eb drawbacks, although I'm tied into my current mortgage for another 2.5years; I would consider it at the changeover date
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Tom J
Organiser: South Wales
Premium Member
Registered: 8th Sep 03
Location: Bridgend
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yeah they are called offset mortgages, good if you are self employed and you are saving up for your tax bill at the end of the year, or you usually have a fair bit of money in your account (thousands)
for every pound you have saved in the current acount, you will not pay interest for that pound on your mortgage. imo it is better than putting it in a savings account as it is more tax efficient
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RichR
Premium Member
Registered: 17th Oct 01
Location: Waterhouses, Staffordshire
User status: Offline
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this isn't a true offset mortgage though; its not the interest deduction, you essentially pay any of the wages left in your account at the end of each month off the balance of your mortgage.
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Cosmo
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Registered: 29th Mar 01
Location: Im the real one!
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quote:
Originally posted by LiVe LeE
this isn't a true offset mortgage though; its not the interest deduction, you essentially pay any of the wages left in your account at the end of each month off the balance of your mortgage.
edit: actually after re-reading (read it last night originally), yes it does 
[Edited on 19-10-2007 by Cosmo]
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Robbo
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Registered: 6th Aug 02
Location: London
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An offset mortgage is where your savings are deducted against your mortgage when interest is calculated... therefore you receive no savings interest but your mortgage interest is less... this has the benefits of saving interest on your mortgage which 99.9% of the time will be at a higher rate than you receive on your savings. In addition you do not pay tax on your interest received... can save you thousands and thousands but onyl works of you have significant savings (ie >£5k ish)
A shrinker is generally where you are encouraged to make additional payments against your mortgage which will reduce the amount you owe and thereofre reduce the amoutn of interest you pay...
A shrinker will lose you physical money, an offset will not
[Edited on 19-10-2007 by Robbo]
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BigSte
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Registered: 27th Aug 02
Location: Sheffield
User status: Offline
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That was helpful that Robbo 
My is due for renewal in just over a year and am looking to get an offset
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Robbo
Member
Registered: 6th Aug 02
Location: London
User status: Offline
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Np dude
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Robbo
Member
Registered: 6th Aug 02
Location: London
User status: Offline
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The reason why shrinkers are misunderstood is that all they are are a basic mortgage which allows overpayments, and does, indeed, encourage it... I would hazard though that the base int rate on a shrinker will be higher than a normal mortgage but the benefits are there if you can afford it
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Colin
Member
Registered: 4th Apr 02
User status: Offline
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I just put in what im going to be earning soon & it said I can pay off my mortgage in 3 months & save half of what I would be paying back!! 
Done it again, based on my current income I could pay it off in 2yrs 2 months.......sounds good!!
[Edited on 19-10-2007 by Colin]
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