Family BS enhances offset mortgage
If customers borrowed £200,000 and £40,000 is deposited interest will only be charged on £160,000 worth of the mortgage, allowing the borrower to either pay back more per month or elect for lower monthly repayments.
Borrowers can also make overpayments on a one-off or regular basis.
Keith Barber, director of business development at the Family Building Society, said: “Our aim is to provide a flexible response to the needs of today’s borrower. For the self-employed, first-time buyers and other borrowers whose family members wish to help them reduce the cost of owning their home, our offset mortgage is compelling.
“It is ideal for the self-employed, who have to keep money for tax aside during the year and can struggle to get through purely computer-based credit assessments of some of the larger providers.
“It’s also another viable option for those who have put away money for a specific purpose, such as for a wedding or a special birthday, and who can now reduce their monthly payments or the mortgage term in the meantime.”
A minimum of £100 is needed to open the offset savings account, which does not earn interest.
Withdrawals are allowed without penalty or a notice period.