In this brief guide, we are going to talk about the Coventry offset mortgage.
What is the Coventry offset mortgage?
A Coventry offset mortgage is a mortgage where your savings are used to reduce the amount of interest you pay on your mortgage.
A Coventry offset mortgage works by linking your Coventry savings account to your Coventry offset mortgage.
The offset mortgage is only offered on repayment mortgages and not buy to let mortgages.
Interest is charged on the difference between your mortgage capital balance and the amount in the offset savings account. The more you deposit in the savings account, the less interest you have to pay. You can withdraw the funds from your savings account at any time as there is no lock-in period. Withdrawing money from your offset savings account will, of course, increase your interest payments.
The funds in the linked account can be deposited by friends or family.
A Coventry offset mortgage can help you;
- Pay your mortgage off quicker
- Reduce your monthly payments now or in the future
Is a Coventry offset mortgage right for you?
It is worth getting mortgage advice before choosing a Coventry offset mortgage from a qualified digital mortgage broker.
A Coventry offset mortgage will not pay you interest on your savings and should really only be used when interest rate earnings on your savings will be less than the interest rate repayments you will have to make on your mortgage in the same time period.
You can get a fixed Coventry offset mortgage or a tracker rate bit this then transfers over to a variable rate with some Coventry offset mortgage products.
You can repay the mortgage at any time but early repayment charges may apply.
A Coventry offset mortgage can be an incredibly cheaper way to get on the property ladder and allow you to pay off your mortgage quickly
You can also make overpayment towards your offset mortgage balance but early repayment charges may apply and once you make these overpayments you won’t be able to access them again. You should contact the Coventry building society to discuss making overpayments on 0800 121 8899.
You can also port your mortgage account to another property. Upon completing the purchase of the property you will be given a new offset savings account and mortgage account.
You must let the building society know whether to cancel or transfer any existing standing orders and Direct Debits as they can’t do this without your permission.
You must also let them know whether they should transfer any money into the new Offset savings account from the old offset account as they can’t do this without our permission.
If your mortgage is repaid, transferred to another property, or transferred to a non-Offset mortgage then Coventry building society will transfer your original Offset savings account into an instant access account.
You can try the Coventry offset mortgage calculator here. You can also use our offset mortgage calculator here.
Is an offset mortgage worth it?
Yes, an offset mortgage may be worth it if you are able to put enough savings into your linked savings account and essentially reduce how much interest you pay on your mortgage and how quickly you pay off your mortgage.
Can you still get offset mortgages?
Yes, you can still get offset mortgages. Some UK mortgage lenders still offer these types of mortgages.
Can you withdraw money from an offset account?
Yes, you can withdraw money from an offset account but it will likely increase the interest you are paying on your mortgage. This depends on when you withdraw the money and if you put it back into the account.
Coventry offset mortgage products
Below are the Coventry offset mortgage products available at the time of writing. You should be aware that the site linked to these products is for intermediaries and not consumers but they do give you an idea of the requirements of each mortgage product. The information contained on the links below is not financial advice.
|Product name||Current rate||Max LTV||Application and product fee||Remortgage transfer service||Valuation included||Early repayment charge|
|OFP21Offset 1.39% Fixed rate to 30.09.21||1.39%||50%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP22Offset 1.79% Fixed rate to 30.09.21||1.79%||50%||Application fee: NoneProduct fee: None|
|OFP27Offset 1.79% Fixed rate to 30.09.24||1.79%||50%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP28Offset 1.99% Fixed rate to 30.09.24||1.99%||50%||Application fee: NoneProduct fee: None|
|OFL62Offset Flexx for Term||2.09%||50%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP23Offset 1.49% Fixed rate to 30.09.21||1.49%||65%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP24Offset 1.89% Fixed rate to 30.09.21||1.89%||65%||Application fee: NoneProduct fee: None|
|OFP29Offset 1.89% Fixed rate to 30.09.24||1.89%||65%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP30Offset 2.09% Fixed rate to 30.09.24||2.09%||65%||Application fee: NoneProduct fee: None|
|OFL63Offset Flexx for Term||2.19%||65%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP18Offset 2.40% Fixed rate to 30.09.29||2.40%||65%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP19Offset 2.50% Fixed rate to 30.09.29||2.50%||65%||Application fee: NoneProduct fee: None|
|OFP25Offset 1.59% Fixed rate to 30.09.21||1.59%||75%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP31Offset 1.99% Fixed rate to 30.09.24||1.99%||75%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFL64Offset Flexx for Term||2.29%||75%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP20Offset 2.45% Fixed rate to 30.09.29||2.45%||75%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP26Offset 1.69% Fixed rate to 30.09.21||1.69%||85%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
|OFP32Offset 2.09% Fixed rate to 30.09.24||2.09%||85%||Application fee: NoneProduct fee: £999 (can be added to mortgage)|
Using a mortgage broker
You may want to consider using an independent mortgage broker to get a mortgage.
Mortgage brokers are important as they can access mortgage products from across the whole of the market in some cases. This could be over 11,000 mortgage products. This may have some advantages than going directly to a mortgage lender.
A mortgage broker will look to understand your financial circumstances and then provide recommendations on which mortgage products may be suitable for you.
After giving you these mortgage recommendations, most mortgage brokers will seek your consent to apply for a mortgage in principle. This will allow you to shop for your home easier as more estate agents and sellers may take you seriously or it will give you confidence that your remortgage is indeed a possibility before you make a full mortgage application. Once you have found a home you want to buy or are satisfied with the mortgage offer for your remortgage then the mortgage broker will then look to get you a mortgage offer.
This will come with a key facts illustration document which details out the features of your mortgage including how much you will pay per month if there are any limits such as early repayment fees, or annual overpayment limits.
If you are happy with everything you can then go on to secure your mortgage with the help of a conveyancer.
Your conveyancer will manage the legal searches on the property to ensure there aren’t any issues with it, they will oversee the sales agreement to ensure it is in your best interest, they will manage the transfer of mortgage funds, exchange contracts with the seller or their conveyancer and set a completion date with the seller or their conveyancer.
In this brief guide we discussed the Coventry offset mortgage. If you have any questions or comments please let us know.
If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.
You can also contact the debt charity “Step Change” if you are in debt and need help.