Santander offset mortgage how does it work

One of the biggest advantages of choosing an offset mortgage rather than putting everything you have into your property deposit is that you can access the cash when you need it although some lenders may require you to keep a minimum balance. This can be quicker and easier than remortgaging to release cash from a standard repayment mortgage. Of course, if you make a withdrawal, that money will no longer offset your mortgage and so your repayments will go up.

If you have little or no money in your linked accounts for a long period of time, it may be worth considering switching to a different type of mortgage. There isn't a simple answer to this question. Putting down a bigger deposit will lower the loan-to-value ratio LTV you're borrowing at, which can mean that you get offered better rates by banks. Keeping some savings back and placing them in an account linked to an offset mortgage would mean you'd be paying interest on a smaller sum, but it would also mean that you'd have access to the cash if you needed it.

This is a more flexible option which is worth bearing in mind if you think you might need cash for a major project such as home renovation. For an offset mortgage to really save you money, you'll generally need a large amount of cash that you can afford to leave untouched in a linked account. Sources: Family Building Society's offset mortgage calculator; Santander's mortgage overpayment calculator.

For higher-rate and additional-rate taxpayers in particular, offset mortgages can be a tax-efficient way to use your savings. This means that the child's interest payments will be smaller, potentially making it easier for them to pass the lender's affordability checks. You might occasionally hear people talking about current account mortgages CAMs , although they're very rare in the current market. While an offset mortgage is linked to a separate bank account, a current account mortgage CAM combines your debts and savings into a single account.

CAMs can sometimes include balances for loans and credit cards as well as your mortgage. Financial Services Limited. Financial Services Limited is a wholly-owned subsidiary of Which? Limited and part of the Which? If you have any further questions about your mortgage, please contact us.

Skip to main content. Personal Support Loans and mortgages support Managing your mortgage online. Managing your mortgage online. Wherever, whenever and in your own time You can manage your mortgage on the go with the Santander Mobile Banking app or by logging on to Online Banking.

Get started. Log on. Change deal. Don't have our mobile app? You can download our app for your phone or device, using the same details you use for Online Banking. You can also arrange your new deal through an Independent Financial Adviser, they will advise you of any costs.

Looking to borrow more money for home improvements? Get an instant decision in principle and apply online. All Flexible Offset mortgages already have an agreed additional borrowing limit, which is on the same rate as the mortgage. The additional borrowing can be repaid on a repayment or interest only basis.

You can access your additional funds through Online Banking. If you need to increase your additional borrowing limit you can ask for a credit limit review charges will apply.

For an in-depth comparison of the mortgage types on offer read our guide to mortgages. So as long as you keep up your payments, your mortgage will be paid off at the end. Your monthly payment only pays off the interest.

We may limit the amount you can borrow on interest only. You can make unlimited overpayments on our lifetime tracker rate mortgage without paying an early repayment charge. Skip to main content. Personal Support Loans and mortgages support What types of mortgages are there?

What types of mortgages are there? How fixed rate mortgages work You choose a number of years to fix your rate for — usually two, three or five. A fixed rate mortgage might suit you if: you prefer to know exactly what you need to pay month to month during the fixed rate period.

Pros With a fixed rate mortgage you can budget for a set period of time.