By overpaying their mortgage by £3 a day, offset mortgage holders could save thousands of pounds in interest and even pay off their mortgage three and a half years early, new research suggests.
Abbey says that by overpaying an offset mortgage with the price of a tube ticket a day, offset mortgage holders can save £22,000 in interest.
Overpayments on mortgages average £500 a month, the mortgage lender found.
Offset mortgages are popular because it allows flexibility to mortgage borrowers whose income varies from one month to the next, according to Abbey.
The head of mortgage marketing at Abbey, Lal Tawney, says the mortgage lender's offset mortgage holders benefit "in many ways".
Abbey's savings offset mortgage, the Flexible Plus, offers a lifetime tracker mortgage rate and allows overpayments, underpayments and payment holidays.
Mr Tawney continues: "Not only will they pay a competitive rate of interest for the life of the mortgage without having to switch to a new deal, but any overpayments will reduce the interest charged as well as cutting the mortgage term."
He says that many mortgage borrowers see remortgaging as a burden, but that the Flexible Plus mortgage offers a "competitive" mortgage deal, meaning that mortgage holders "never have to incur the expense of remortgaging".
Offset mortgage overpayments could save money, says Abbey
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Offset mortgage overpayments could save money, says Abbey
Tue, 24 Jan 2006
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