Barclays boosts its range of offset deals
Barclays is launching a new range of Woolwich Offset mortgages which includes a competitively priced two year Offset tracker at 2.38 per cent (base + 1.88 market).
The new deals being introduced and available until 20th September are a two year Offset tracker at 2.38 per cent (base +1.88 per cent) with a £1,499 fee, which leads the high street at 70 per cent loan to value (LTV). At 75 per cent (LTV), a two year Offset tracker will be launched at 2.88 per cent (base + 2.38 per cent) with a £999. Both deals revert to base +2.99 per cent after the two years.
As an alternative an Offset lifetime tracker rate at 70 per cent LTV is available at 2.98 per cent (base + 2.48 per cent) with a £999 fee. For customers that qualify for a loyalty mortgage then the rate is reduced by 0.20 per cent (2.78 per cent) for the first two years. All other offset deals remain unchanged.
Andy Gray, Head of Mortgages for Barclays said: "Offset mortgages are now more valuable than ever. They are a win/win solution for borrowers as they can pay off their mortgage quicker, keep instant access on their savings and boost their savings rate with equivalent returns of more than 5 per cent. The deals introduced today for a limited period, not only offer some of the most competitive offset rates on the market but are comparable with many general trackers which don't offset."
Offset mortgages can really benefit savers and tax payers by helping to limit the impact of tax and inflation. On our latest 75 per cent LTV deal priced at 2.88 per cent, a 20 per cent taxpayer would need to find an equivalent savings rate of above 3.60 per cent, a 40 per cent taxpayer will need 4.80per cent in interest, and at 50 per cent tax would need to earn 5.76 per cent in interest to get the same savings as offsetting their mortgage.
A borrower with a £100,000 mortgage, with £750 average current account balance, £10,000 savings and an additional £100 being added to their savings each month could save almost £15,500 (£15,464) in mortgage interest or pay off their mortgage over 3 years early. (calculated on the Offset lifetime tracker base + 2.48 per cent).
Unlike some of its competitors, The Woolwich Offset also has the advantage of being linked to both current and savings accounts, including cash ISAs, and tracks for the life of the mortgage. All Woolwich tracker mortgages come with 'Switch and Fix' which allows borrowers to switch to any current Woolwich fixed rate mortgage deal with no early repayment charge giving them the opportunity to benefit from low tracker rates now, with the security of fixing their payments at any point they choose.
More information on the full range of Woolwich mortgages is available at barclays.co.uk/mortgages.