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Rates, repayments and fees

What is Offset Mortgage?

A mortgage linked to savings that reduce the balance used to calculate interest.

Definition

The linked savings are normally not used to repay the mortgage; instead, the lender calculates interest on the mortgage balance minus the qualifying savings balance. Access, account ownership, rate and repayment options vary by product.

Practical example

With a £200,000 mortgage and £30,000 in linked savings, interest may be calculated on £170,000 while the savings remain available under the account terms.

Why it matters

Compare the interest saving with alternative savings returns, product pricing and the need for cash access.

Mortgage repayment calculator

Source and review

Reviewed 16 July 2026. Product criteria and rules can change.

MoneyHelper: mortgages and interest rates

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