First Active flexible offset mortgage

[Deb]

Hi all, I read another thread on this subject but it was quite a brief one.

My story is that I am currently with First Active on a fixed rate which is due to finish up next month. I have met with them and discussed a flexible offset mortgage which seems to suit us. Our loan to value rate is currently around 53% and we aim to take the mortgage out over 23 years. The plan is to save €200 - €300 month in the offset account and ultimately this should knock approx 4 years off the term of the mortgage.

I have been advised by someone that the product is not all it seems and that it is not worth doing however they won't give me any details other than saying First Active customer service is dreadful.

I was all set to go with this option but now I'm very unsure. Does anyone have any advice? Many thanks.

 

[agapanthus]

It all depends on what you do with that extra money every month. If it is your intention to save that much every month every year and will not need any of it again then I would say the offset is a waste of time for you. You could get a better tracker mtg rate and just pay the extra into that and it would finish early just the same.

However if you want the flexibility of maybe not putting in the extra money every month or you will need to draw some of the spare money back out again then the fact that it is not in your mortgage but just in a linked savings account makes that easy.

The rate on the offset is 5.15, with your LTV you could probably get a tracker of 4.5ish. You could then if you wanted lodge the extra into the FA esavings account at 5.22% or whatever high rate account you can get and transfer a lump sum into the mortgage every time it builds up. Again this will only suit if you do not need that money again.

 

[RMCF]

It all depends on what you do with that extra money every month. If it is your intention to save that much every month every year and will not need any of it again then I would say the offset is a waste of time for you. You could get a better tracker mtg rate and just pay the extra into that and it would finish early just the same.

However if you want the flexibility of maybe not putting in the extra money every month or you will need to draw some of the spare money back out again then the fact that it is not in your mortgage but just in a linked savings account makes that easy.

The rate on the offset is 5.15, with your LTV you could probably get a tracker of 4.5ish. You could then if you wanted lodge the extra into the FA esavings account at 5.22% or whatever high rate account you can get and transfer a lump sum into the mortgage every time it builds up. Again this will only suit if you do not need that money again.

I also started a thread recently about taking out an offset mortgage, but I didn't realise that you were able to have an ordinary mortgage and pay extra into it. I thought if you had a standard mortgage the lender would only accept your monthly amount, not any additional funds to reduce your loan.

Is this possible on many mortgages or do you have to ask for a specific one?