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What is a Current Account Mortgage (CAM)
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Last update : November 2011
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| A Current Account Mortgage is a style of Offset Mortgage but it's not that common. More details on Offset Mortgages.
Whereas both an offset and current account mortgage combine all of your savings and debts, an offset style plan should separate the money.
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| This means when you check your financial details you'll see the individual size of the loan, your savings and current account balance.
But a current account mortgage won't usually do this.
Instead it will combine all your accounts (debit and credit) into a single figure which of course will be both large and negative. For example, if you have a £100k mortgage loan, £20k in savings and £5k in your current account your balance will read -£75,000.
Three final points to consider -
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- Salary paid into your account - With the majority of offset mortgages your bank won't insist that your salary is paid into that account, but most CAMs will require this
- CAMs are usually best suited to high earners (£75,000+) who often leave large amounts (in excess of £2,000, preferably more) sitting in their current accounts
- CAMs as well as flexible mortgages are possibly the best loans if you want to regularly make overpayments, or work with underpayments and payment holidays. So they're best suited to those who have irregular incomes such as contract workers who might work for 6 months, then no work for 2 followed by 4 more months of work etc
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