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Offset Mortgage Dilemma

I have a dilemma that I've been ponding for some months now, I'm hoping somebody could give me some advice please. I currently have a mortgage of £40,000, but I don't like paying all the interest that goes with this mortgage, so my plan was to get a few credit cards, an offset mortgage and balance transfer from the credit cards at 0% interest into the savings account part of the offset mortgage to allow me to pay off the debt more quickly and build up more equity in my home,

BUT,

I would like to move house in approximately 12 to 18 months time, which would give me a new mortgage of approximately £130,000.

Would I be better off doing the offset mortgage and credit card trick on the new mortgage in 18 months time, or straight away on my current debt to try and reduce the amount I would need to borrow for the larger mortgage?

Any advice, help, or comments would be greatly appreciated,

Thank you,

Reply to
Steve
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BUT,

I would like to move house in approximately 12 to 18 months time, which would give me a new mortgage of approximately 130,000.

Would I be better off doing the offset mortgage and credit card trick on the new mortgage in 18 months time, or straight away on my current debt to try and reduce the amount I would need to borrow for the larger mortgage?

Any advice, help, or comments would be greatly appreciated,

Thank you,

If you are going to do it I would do it now. Already 0% cards are getting harder to find and those who offer it are starting to charge a balance transfer fee of around 2%(some cap this at between 35-50). Who knows what will be available in 18 months time? Eric

Reply to
Eric Jones

BUT,

I would like to move house in approximately 12 to 18 months time, which would give me a new mortgage of approximately 130,000.

Would I be better off doing the offset mortgage and credit card trick on the new mortgage in 18 months time, or straight away on my current debt to try and reduce the amount I would need to borrow for the larger mortgage?

Any advice, help, or comments would be greatly appreciated,

Thank you,

I would do the 0% trick but put the money in a bank account, you'll be much better off than closing the mortgage and re-mortgaging to an offset where the interest rate is generally 0.0025% greater than a flexible mortgage and the closing and opening costs associated with a mortgage.

Reply to
Jane Tweedynn

I'm currenly paying £190 per month in interest on my mortgage, I didn't think I'd be able to get the same amount in interest, using a savings account. My current mortgage has recently come to the end of it's fixed rate period so I want to change mortgage so I can increase the monthly payments. I'm also concerned about how the credit card debt will affect my ability to get a larger mortgage in 18 months time, even though I could pay back the credit cards at a moments notice from the savings account. Steve

Reply to
Steve

If you do the maths you'll find the interest saved over a year compared to what you would have got via savings interest, will be minimal over the next year. You might save a few hundred pounds. Nothing wrong with that (I'm doing it myself) but in the context of a 130k mortgage, irrelevant. So, no dilemma after all :-)

Reply to
Tumbleweed

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