offset mortgage query

[dockingtrade]

i have €30K in the credit side of an offset mortagage. We put it inthere after the SSIAs while waiting to see what to do with. I want risk free savings so thats a deposit acc. AM I better off leaving it offsetting my mortgage or is there a deposit account out there that would wrk out better...considering all these 7.5 % or 8% etc advertised deposit accounts only last a year and are for the first €1500 or €2000, also DIRT.
Thanks

 

[griswold]

I'd be interested to hear views on this myself. I too have a lump sum on deposit against an offset mortgage. I'm endlessly weighing up whether or not it would be better off in a regular high interest deposit account. As I cant decide I've split in half - half against the mortgage in NIB and half in Northern Rock.

 

[chippengael]

We had an NIB offset account and I think it worked out well for us.

1. You don't pay dirt
2. You have access to your savings
3. You get the same rate as your mortgage - no introductory offers etc
4. It's risk free

On the down side you can't access the interest, as it goes directly towards paying off your mortgage.

So unless you feel you can get a better rate than your mortgage (after DIRT tax!), I'd leave the money in the offset.

Just my two cents.

 

[WaterSprite]

The offset mortgage interest rates with NIB are higher than e.g. a 60% LTV with them (5.24% vs 4.68%) so you are paying more. It would be better to see what the lowest rate you can get with your current provider is and then compare against a lump sum deposit account (taking into account the DIRT rate). My guess is, if you can maximise your regular savings options (and take on all that admin), you'll be better off than keeping the money in the offset.

Sprite