Offset mortgages are better suited to higher-rate tax payers who have above average savings and are prepared to commit for a long period, new research from Defaqto claims.
The research report says while the majority of borrowers select their mortgage on the basis of the lowest initial interest rate for the type of mortgage they want, there could be significant long-term advantages to selecting an offset mortgage. The report says these include financial flexibility, tax efficiency, a potentially shortened mortgage term, plus avoiding the hassle of regularly remortgaging to get the best rate and lower tracker rates over the mortgage term. But Defaqto says despite offset mortgages taking about 10% of new mortgage lending and being projected to grow substantia...
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