Welcome!

Symbian Authors: Jack Newton, Kevin Benedict, Matthew Lobas, Shelly Palmer, RealWire News Distribution

News Feed Item

Offsetting Savings Against Your Mortgage Could be an Alternative Solution to Falling Savings Rates

CHESTER, England, November 6, 2012 /PRNewswire/ --

  • Borrowers can reduce mortgage interest, mortgage term and tax liabilities by offsetting their savings against their mortgage

With interest rates on the top paying savings accounts falling considerably over the past few months, many savers will be looking at viable alternatives to make their savings work harder for them. For savers with a mortgage, one possible option is using an offset, which can not only reduce the amount of mortgage interest and the term of the loan, but can also help reduce tax liabilities, according to MoneySupermarket.com.

An offset mortgage allows borrowers to link their savings to their mortgage balance.  Instead of earning interest on savings, the money is set against the outstanding mortgage, with interest only accruing on the remaining balance. As a result, less interest is paid on the mortgage debt, and the mortgage can be paid off earlier. For example, someone with a £150,000 mortgage and £30,000 in savings would only be charged mortgage interest on £120,000. However, in many cases the mortgage repayments would be based on the full £150,000 loan meaning they overpay each month.

For example, assuming a £150,000 capital repayment mortgage at a rate of 3.00 per cent borrowed over 25 years, someone with £30,000 in savings would save themselves £10,039 in interest and repay their mortgage three years early. In addition, a basic rate tax payer could save £3,653.32 in income tax, and a 40 per cent taxpayer would save £7,306.63 in income tax that they would have to pay if their money was in a standard savings account paying 2.00 per cent AER.

A basic rate taxpayer would need to earn the equivalent of 3.75 per cent or more on a standard savings account in order to generate an equivalent return to the benefit offsetting would have, however there are currently no accounts that beat this. A 40 per cent taxpayer would need a savings account paying 5.00 per cent or more, while someone in the 50 per cent band would need to be earning at least 6.00 per cent.

Clare Francis, mortgage expert at  MoneySupermarket  said: "The advantages of an offset mortgage are evident to see for people who have decent savings pots but who are struggling to find a real return for those savings. In addition, offsetting can also save you tax - usually, you pay income tax on interest you earn on your savings. However, because you don't earn any interest if the money is offset against your mortgage, there is no tax to pay, making this a particularly attractive option for higher and top rate taxpayers.

"Of course, you could have a standard mortgage and use your savings to pay a chunk of it off, but if you do this it is difficult to get at that money again if you ever need it. With an offset, you can access your savings at any time. In addition, most mortgage products restrict the amount you can pay off each year - it is usually capped at 10 per cent of the outstanding balance. Offsets have no such restrictions.

"Offsetting can be a great way of getting more from your savings and paying less tax. However, it won't be the right thing for everyone. Much will depend on the 'premium' you have to pay to offset and the amount of interest you could earn on your savings. If you are looking for a new mortgage, it's worth investigating whether an offset could be right for you rather than just sticking with standard mortgage and savings accounts, particularly at the moment with savings rates so low."

Notes to Editors

Offset mortgages

                                                       Max   Arr/Bkg
         Lender       Pay Rate   Rate Type   Period    LTV     Fee       ERC
    Chelsea BS          2.54%      Fixed     2 Years   70%   GBP1,895  2 Years
    Yorkshire BS        2.59%      Fixed    31-Dec-14  60%   GBP1,295 31-Dec-14
    Beverley BS         2.75%    Discount    3 Years   75%    GBP995   3 Years
    Yorkshire BS        2.79%     Tracker   31-Dec-14  75%    GBP995  31-Dec-14
    First Direct        2.89%      Fixed     2 Years   65%    GBP999   2 Years
 


Source: http://www.MoneySupermarket.com 5.11.12

MoneySupermarket.com compares (at 30th August 2012)

  • 107 car insurance providers and 82 home insurance providers
  • 12 broadband providers and 18 energy providers   
  • 32 unsecured loan and 6 secured loan providers
  • 62 mortgage lenders and 28 credit card providers
  • 66 savings providers and 37 current account providers.
  • Over 1,200,000 mobile phone deals

Our customers

We help our customers to save money on all of their household bills by providing a free, easy to use online service so they can compare a wide range of products in one place and find the product most suited to their needs. Our size means we are able to offer our customers exclusive, market-leading deals, including some they can't even get direct from providers.

Our providers

By having considerable volumes of informed customers actively looking for products and ready to purchase, we offer our providers an efficient and cost effective customer acquisition solution across all of our channels. This enables our providers to target their marketing spend in an effective and completely measurable way.

Our revenue comes predominantly from fees paid to us by product providers when a customer clicks through to their website and actually applies for or purchases a product. It is a success based marketing fee.

For further information please contact:

Paul Lawler/ Nicki Parry
MoneySupermarket.com
+44-(0)787-237-9545 / +44-(0)1244-370-318
[email protected] / [email protected]


More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
"People are a lot more knowledgeable about APIs now. There are two types of people who work with APIs - IT people who want to use APIs for something internal and the product managers who want to do something outside APIs for people to connect to them," explained Roberto Medrano, Executive Vice President at SOA Software, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Performance is the intersection of power, agility, control, and choice. If you value performance, and more specifically consistent performance, you need to look beyond simple virtualized compute. Many factors need to be considered to create a truly performant environment. In his General Session at 15th Cloud Expo, Harold Hannon, Sr. Software Architect at SoftLayer, discussed how to take advantage of a multitude of compute options and platform features to make cloud the cornerstone of your online presence.
An entirely new security model is needed for the Internet of Things, or is it? Can we save some old and tested controls for this new and different environment? In his session at @ThingsExpo, New York's at the Javits Center, Davi Ottenheimer, EMC Senior Director of Trust, reviewed hands-on lessons with IoT devices and reveal a new risk balance you might not expect. Davi Ottenheimer, EMC Senior Director of Trust, has more than nineteen years' experience managing global security operations and assessments, including a decade of leading incident response and digital forensics. He is co-author of t...
SYS-CON Media announced that Splunk, a provider of the leading software platform for real-time Operational Intelligence, has launched an ad campaign on Big Data Journal. Splunk software and cloud services enable organizations to search, monitor, analyze and visualize machine-generated big data coming from websites, applications, servers, networks, sensors and mobile devices. The ads focus on delivering ROI - how improved uptime delivered $6M in annual ROI, improving customer operations by mining large volumes of unstructured data, and how data tracking delivers uptime when it matters most.
DevOps Summit 2015 New York, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete at launch. DevOps may be disruptive, but it is essential.
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it's a mix of architectural styles ...
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
"There is a natural synchronization between the business models, the IoT is there to support ,” explained Brendan O'Brien, Co-founder and Chief Architect of Aria Systems, in this SYS-CON.tv interview at the 15th International Cloud Expo®, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
The BPM world is going through some evolution or changes where traditional business process management solutions really have nowhere to go in terms of development of the road map. In this demo at 15th Cloud Expo, Kyle Hansen, Director of Professional Services at AgilePoint, shows AgilePoint’s unique approach to dealing with this market circumstance by developing a rapid application composition or development framework.

ARMONK, N.Y., Nov. 20, 2014 /PRNewswire/ --  IBM (NYSE: IBM) today announced that it is bringing a greater level of control, security and flexibility to cloud-based application development and delivery with a single-tenant version of Bluemix, IBM's platform-as-a-service. The new platform enables developers to build ap...

Advanced Persistent Threats (APTs) are increasing at an unprecedented rate. The threat landscape of today is drastically different than just a few years ago. Attacks are much more organized and sophisticated. They are harder to detect and even harder to anticipate. In the foreseeable future it's going to get a whole lot harder. Everything you know today will change. Keeping up with this changing landscape is already a daunting task. Your organization needs to use the latest tools, methods and expertise to guard against those threats. But will that be enough? In the foreseeable future attacks w...
As enterprises move to all-IP networks and cloud-based applications, communications service providers (CSPs) – facing increased competition from over-the-top providers delivering content via the Internet and independently of CSPs – must be able to offer seamless cloud-based communication and collaboration solutions that can scale for small, midsize, and large enterprises, as well as public sector organizations, in order to keep and grow market share. The latest version of Oracle Communications Unified Communications Suite gives CSPs the capability to do just that. In addition, its integration ...
Building low-cost wearable devices can enhance the quality of our lives. In his session at Internet of @ThingsExpo, Sai Yamanoor, Embedded Software Engineer at Altschool, provided an example of putting together a small keychain within a $50 budget that educates the user about the air quality in their surroundings. He also provided examples such as building a wearable device that provides transit or recreational information. He then reviewed the resources available to build wearable devices at home including open source hardware, the raw materials required and the options available to power s...
“The age of the Internet of Things is upon us,” stated Thomas Svensson, senior vice-president and general manager EMEA, ThingWorx, “and working with forward-thinking companies, such as Elisa, enables us to deploy our leading technology so that customers can profit from complete, end-to-end solutions.” ThingWorx, a PTC® (Nasdaq: PTC) business and Internet of Things (IoT) platform provider, announced on Monday that Elisa, Finnish provider of mobile and fixed broadband subscriptions, will deploy ThingWorx® platform technology to enable a new Elisa IoT service in Finland and Estonia.
From telemedicine to smart cars, digital homes and industrial monitoring, the explosive growth of IoT has created exciting new business opportunities for real time calls and messaging. In his session at @ThingsExpo, Ivelin Ivanov, CEO and Co-Founder of Telestax, shared some of the new revenue sources that IoT created for Restcomm – the open source telephony platform from Telestax. Ivelin Ivanov is a technology entrepreneur who founded Mobicents, an Open Source VoIP Platform, to help create, deploy, and manage applications integrating voice, video and data. He is the co-founder of TeleStax, a...
The Internet of Things is not new. Historically, smart businesses have used its basic concept of leveraging data to drive better decision making and have capitalized on those insights to realize additional revenue opportunities. So, what has changed to make the Internet of Things one of the hottest topics in tech? In his session at @ThingsExpo, Chris Gray, Director, Embedded and Internet of Things, discussed the underlying factors that are driving the economics of intelligent systems. Discover how hardware commoditization, the ubiquitous nature of connectivity, and the emergence of Big Data a...