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What is a Family Offset Mortgage
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A Family Offset Mortgage works in a similar fashion to an Offset Mortgage taken by a single person but as the name suggests all the family's savings are taken into account.

For example -

  • The total mortgage loan is £200,000
  • Father has £35,000 in savings
  • Mother has £20,000 in savings, and
  • Little Jonny has £5,000 in savings

Collectively the family's savings are £60,000 so interest is only charged on a mortgage debt of £140,000 (£100k - £60k). However if one family member needs to withdraw a portion of their savings, this amount is then added to the original debt.

Conversely if any further money is paid into the offset account, the mortgage debt is further reduced.

The downside to this strategy is that nobody receives an actual income on their savings.

One final point - Only a small number of lenders will offer family offset mortgages. Plus, as the market is relatively small any deals might not be that competitive. Still, if you're interested they're worth investigating.

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