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By Emily Rivers
Last updated 14th April 2023

Save interest payments with an offset mortgage

An offset mortgage can be beneficial to borrowers who have a savings lump sum they want to be able to access easily, and could save them thousands of pounds in mortgage interest payments.

What is an offset mortgage?

An offset mortgage is a home loan where a person's savings are used to reduce the amount of interest paid each month, without actually spending the money. 

For example, if you had a £250,000 mortgage but put £30,000 in savings against the mortgage you'd only pay interest on £220,000. The mortgage lender would hold onto the £30,000 until you wanted it back, at which point interest would be charged at the new level. So if you wanted £10,000 back, you'd then start paying interest on the mortgage minus £20,000.

You still must repay the full mortgage, but you save money on the interest that is being charged.

An offset mortgage could save you hundreds of pounds in repayments each month, but they can come with higher rates which could negate some of the savings.

Cheap offset mortgage

What types of offset mortgages are available?

There are all the usual types of loans available with an offset mortgage. You could choose from:

  • Fixed rate mortgage: Interest is set for a certain period such as two, five or 10 years. 
  • Interest only mortgage: Only repaying the interest of a mortgage and then repay the mortgage in full at the end of the term.
  • Tracker mortgage: A variable interest mortgage where the interest moves up and down with the Bank of England's base rate.
  • Discount offset mortgage: Interest payments are at a discount of the lender's standard variable rate
  • Family offset mortgage: This is an offset mortgage where a family member can provide the savings capital, rather than the mortgage holder.

 

Offset mortgage rates

Offset mortgages can save you money on interest but the rates available are usually higher than a standard fixed or tracker deal. This is because they come with the flexibility of being able to access your savings when you want. 

When deciding whether an offset mortgage is right for you, it's a good idea to compare the savings you will make in interest repayments to the interest you could earn if that money went into a savings account instead. When interest rates are low it is difficult to make money on savings, but if they are stronger you may need to carefully compare money saved in interest repayments with the money you could make in a savings account. 

Another factor to consider is if putting the savings towards a deposit or to pay off more of the mortgage outright would free up access to lower mortgage rates for other deals. 

Our mortgage partners at Brighton & Hove compare rates of hundreds of deals to help you find the best price for your circumstances. Click here to fill out a short form and discover the rates.

How do offset mortgages work?

Offset mortgages work by putting your savings against your mortgage to lower the interest you pay. Savings ‘offset’ the amount of interest paid so while your mortgage may be £200,000, putting £20,000 savings against the mortgage means you pay interest on just £180,000.

Do I get my savings back with an offset mortgage?

Yes, you can get your savings back with an offset mortgage, usually at any time during the term. But if the savings are returned when the mortgage is still open you will start being charged more in interest repayments. 

If you still have savings in your offset account when the mortgage has been paid off, you will get these returned to you. Be aware that while the savings are in the offset account they won’t be earning interest, unlike if they were in a savings account. 

Can I withdraw money from an offset account?

Yes, you can withdraw as much or as little money as you want from your offset account. If you do withdraw money you will start paying interest on more of the loan because there will be less money offsetting the mortgage.


Estimated monthly mortgage costs

JobEstimate
Secured loan£102 per month
Remortgaging£1,195 per month
Cheap variable rate mortgage£1,159 per month
Cheap tracker mortgage£1,303 per month
Cheap offset mortgage£1,088 per month
Cheap interest only mortgage£1,147 per month
Cheap fixed rate mortgage£1,245 per month
Cheap capital repayment mortgage£1,256 per month
Cheap buy to let mortgage£1,271 per month

Rates for other trades

Offset mortgage estimated monthly repayment based on average house prices 2025
Offset mortgage estimated month payment base on local average house prices, 75% LTV repaid over 25yrs source: uswitch - rate 289818%
Location in UKOffset mortgage cost
Offset mortgage near Aberdeen£513
Offset mortgage near Aberdeenshire£754
Offset mortgage near Adur£1,445
Offset mortgage near Allerdale£687
Offset mortgage near Amber Valley£882
Offset mortgage near Angus£637
Offset mortgage near Antrim and Newtownabbey£674
Offset mortgage near Ards and North Down£755
Offset mortgage near Argyll and Bute£705
Offset mortgage near Armagh City Banbridge and Craigavon£586
Offset mortgage near Arun£1,391
Offset mortgage near Ashfield£719
Offset mortgage near Ashford£1,416
Offset mortgage near Babergh£1,326
Offset mortgage near Barking and Dagenham£1,328
Offset mortgage near Barnet£2,232
Offset mortgage near Barnsley£627
Offset mortgage near Barrow-in-Furness£544
Offset mortgage near Basildon£1,462
Offset mortgage near Basingstoke & Deane£1,393
Offset mortgage near Bassetlaw£743
Offset mortgage near Bath & North East Somerset£1,672
Offset mortgage near Bedford£1,319
Offset mortgage near Belfast£604
Offset mortgage near Bexley£1,509
Offset mortgage near Birmingham£900
Offset mortgage near Blaby£1,129
Offset mortgage near Blackburn with Darwen£553
Offset mortgage near Blackpool£510
Offset mortgage near Blaenau Gwent£513
Offset mortgage near Bolsover£661
Offset mortgage near Bolton£713
Offset mortgage near Boston£751
Offset mortgage near Bournemouth Christchurch and Poole£1,321
Offset mortgage near Bracknell Forest£1,514
Offset mortgage near Bradford£659
Offset mortgage near Braintree£1,330
Offset mortgage near Breckland£1,134
Offset mortgage near Brent£2,096
Offset mortgage near Brentwood£1,808
Offset mortgage near Bridgend£763
Offset mortgage near Brighton and Hove£1,704
Offset mortgage near Bristol£1,352
Offset mortgage near Broadland£1,306
Offset mortgage near Bromley£1,950
Offset mortgage near Bromsgrove£1,379
Offset mortgage near Broxbourne£1,527
Offset mortgage near Broxtowe£965
Offset mortgage near Buckinghamshire£1,818
Offset mortgage near Burnley£440
Offset mortgage near Bury£896
Offset mortgage near Caerphilly£712
Offset mortgage near Calderdale£695
Offset mortgage near Cambridge£1,984
Offset mortgage near Cambridgeshire£1,363
Offset mortgage near Camden£3,155
Offset mortgage near Cannock Chase£881
Offset mortgage near Canterbury£1,414
Offset mortgage near Cardiff£1,015
Offset mortgage near Carlisle£631
Offset mortgage near Carmarthenshire£817
Offset mortgage near Castle Point£1,460
Offset mortgage near Causeway Coast and Glens£731
Offset mortgage near Central Bedfordshire£1,444
Offset mortgage near Ceredigion£987
Offset mortgage near Charnwood£1,110
Offset mortgage near Chelmsford£1,461
Offset mortgage near Cheltenham£1,285
Offset mortgage near Cherwell£1,412
Offset mortgage near Cheshire East£1,128
Offset mortgage near Cheshire West and Chester£1,019
Offset mortgage near Chesterfield£764
Offset mortgage near Chichester£1,775
Offset mortgage near Chorley£883
Offset mortgage near City of London£3,324
Offset mortgage near City of Westminster£3,399
Offset mortgage near Clackmannanshire£644
Offset mortgage near Colchester£1,231
Offset mortgage near Conwy£824
Offset mortgage near Copeland£584
Offset mortgage near Cornwall£1,199
Offset mortgage near Cotswold£1,902
Offset mortgage near County Durham£501
Offset mortgage near Coventry£883
Offset mortgage near Craven£1,056
Offset mortgage near Crawley£1,252
Offset mortgage near Croydon£1,631
Offset mortgage near Cumbria£731
Offset mortgage near Dacorum£1,821
Offset mortgage near Darlington£606
Offset mortgage near Dartford£1,352
Offset mortgage near Denbighshire£774
Offset mortgage near Derby£784
Offset mortgage near Derbyshire£898
Offset mortgage near Derbyshire Dales£1,360
Offset mortgage near Derry City and Strabane£575
Offset mortgage near Devon£1,295
Offset mortgage near Doncaster£630
Offset mortgage near Dorset£1,376
Offset mortgage near Dover£1,212
Offset mortgage near Dudley£892
Offset mortgage near Dumfries & Galloway£620
Offset mortgage near Dundee£532
Offset mortgage near Ealing£2,051
Offset mortgage near East Ayrshire£468
Offset mortgage near East Cambridgeshire£1,287
Offset mortgage near East Devon£1,405
Offset mortgage near East Dunbartonshire£979
Offset mortgage near East Hampshire£1,766
Offset mortgage near East Hertfordshire£1,717
Offset mortgage near East Lindsey£917
Offset mortgage near East Lothian£1,175
Offset mortgage near East Midlands£943
Offset mortgage near East of England£1,345
Offset mortgage near East Renfrewshire£1,071
Offset mortgage near East Riding of Yorkshire£864
Offset mortgage near East Staffordshire£880
Offset mortgage near East Suffolk£1,209
Offset mortgage near East Sussex£1,372
Offset mortgage near Eastbourne£1,160
Offset mortgage near Eastleigh£1,331
Offset mortgage near Eden£1,003
Offset mortgage near Edinburgh£1,210
Offset mortgage near Elmbridge£2,693
Offset mortgage near Enfield£1,742
Offset mortgage near England£1,165
Offset mortgage near England and Wales£1,145
Offset mortgage near Epping Forest£2,068
Offset mortgage near Epsom and Ewell£2,036
Offset mortgage near Erewash£811
Offset mortgage near Essex£1,450
Offset mortgage near Exeter£1,263
Offset mortgage near Falkirk£615
Offset mortgage near Fareham£1,388
Offset mortgage near Fenland£924
Offset mortgage near Fermanagh and Omagh£609
Offset mortgage near Fife£638
Offset mortgage near Flintshire£807
Offset mortgage near Folkestone and Hythe£1,257
Offset mortgage near Forest of Dean£1,214
Offset mortgage near Fylde£910
Offset mortgage near Gateshead£582
Offset mortgage near Gedling£945
Offset mortgage near Glasgow£648
Offset mortgage near Gloucester£948
Offset mortgage near Gloucestershire£1,281
Offset mortgage near Gosport£1,011
Offset mortgage near Gravesham£1,279
Offset mortgage near Great Britain£1,100
Offset mortgage near Great Yarmouth£861
Offset mortgage near Greater Manchester£884
Offset mortgage near Greenwich£1,671
Offset mortgage near Guildford£1,972
Offset mortgage near Gwynedd£793
Offset mortgage near Hackney£2,388
Offset mortgage near Halton£731
Offset mortgage near Hambleton£1,157
Offset mortgage near Hammersmith and Fulham£2,814
Offset mortgage near Hampshire£1,466
Offset mortgage near Harborough£1,432
Offset mortgage near Haringey£2,303
Offset mortgage near Harlow£1,249
Offset mortgage near Harrogate£1,258
Offset mortgage near Harrow£1,983
Offset mortgage near Hart£1,876
Offset mortgage near Hartlepool£532
Offset mortgage near Hastings£1,124
Offset mortgage near Havant£1,278
Offset mortgage near Havering£1,631
Offset mortgage near Herefordshire£1,163
Offset mortgage near Hertfordshire£1,745
Offset mortgage near Hertsmere£1,992
Offset mortgage near High Peak£982
Offset mortgage near Highland£784
Offset mortgage near Hillingdon£1,755
Offset mortgage near Hinckley and Bosworth£1,093
Offset mortgage near Horsham£1,726
Offset mortgage near Hounslow£1,765
Offset mortgage near Huntingdonshire£1,211
Offset mortgage near Hyndburn£482
Offset mortgage near Inner London£2,325
Offset mortgage near Inverclyde£464
Offset mortgage near Ipswich£906
Offset mortgage near Isle of Anglesey£944
Offset mortgage near Isle of Wight£1,103
Offset mortgage near Islington£2,519
Offset mortgage near Kensington and Chelsea£3,755
Offset mortgage near Kent£1,396
Offset mortgage near Kings Lynn & West Norfolk£1,075
Offset mortgage near Kingston upon Hull£520
Offset mortgage near Kingston upon Thames£2,143
Offset mortgage near Kirklees£733
Offset mortgage near Knowsley£694
Offset mortgage near Lambeth£2,081
Offset mortgage near Lancashire£718
Offset mortgage near Lancaster£770
Offset mortgage near Leeds£902
Offset mortgage near Leicester£886
Offset mortgage near Leicestershire£1,148
Offset mortgage near Lewes£1,534
Offset mortgage near Lewisham£1,735
Offset mortgage near Lichfield£1,226
Offset mortgage near Lincoln£690
Offset mortgage near Lincolnshire£905
Offset mortgage near Lisburn£782
Offset mortgage near Liverpool£686
Offset mortgage near London£2,005
Offset mortgage near Luton£1,083
Offset mortgage near Maidstone£1,351
Offset mortgage near Maldon£1,616
Offset mortgage near Malvern Hills£1,325
Offset mortgage near Manchester£888
Offset mortgage near Mansfield£681
Offset mortgage near Medway£1,160
Offset mortgage near Melton£1,173
Offset mortgage near Mendip£1,309
Offset mortgage near Merseyside£736
Offset mortgage near Merthyr Tydfil£587
Offset mortgage near Merton£2,154
Offset mortgage near Mid and East Antrim£603
Offset mortgage near Mid Devon£1,195
Offset mortgage near Mid Suffolk£1,276
Offset mortgage near Mid Sussex£1,801
Offset mortgage near Mid Ulster£633
Offset mortgage near Middlesbrough£538
Offset mortgage near Midlothian£879
Offset mortgage near Milton Keynes£1,202
Offset mortgage near Mole Valley£2,213
Offset mortgage near Monmouthshire£1,358
Offset mortgage near Moray£710
Offset mortgage near Na h-Eileanan Siar£560
Offset mortgage near Neath Port Talbot£633
Offset mortgage near New Forest£1,583
Offset mortgage near Newark and Sherwood£913
Offset mortgage near Newcastle Upon Tyne£732
Offset mortgage near Newcastle-under-Lyme£748
Offset mortgage near Newham£1,622
Offset mortgage near Newport£913
Offset mortgage near Newry Mourne and Down£698
Offset mortgage near Norfolk£1,125
Offset mortgage near North Ayrshire£485
Offset mortgage near North Devon£1,223
Offset mortgage near North East£613
Offset mortgage near North East Derbyshire£972
Offset mortgage near North East Lincolnshire£579
Offset mortgage near North Hertfordshire£1,451
Offset mortgage near North Kesteven£1,038
Offset mortgage near North Lanarkshire£518
Offset mortgage near North Lincolnshire£713
Offset mortgage near North Norfolk£1,261
Offset mortgage near North Northamptonshire£1,042
Offset mortgage near North Somerset£1,283
Offset mortgage near North Tyneside£779
Offset mortgage near North Warwickshire£1,019
Offset mortgage near North West£805
Offset mortgage near North West Leicestershire£1,068
Offset mortgage near North Yorkshire£1,060
Offset mortgage near Northern Ireland£658
Offset mortgage near Northumberland£742
Offset mortgage near Norwich£951
Offset mortgage near Nottingham£729
Offset mortgage near Nottinghamshire£885
Offset mortgage near Nuneaton & Bedworth£900
Offset mortgage near Oadby and Wigston£1,090
Offset mortgage near Oldham£721
Offset mortgage near Orkney Islands£837
Offset mortgage near Outer London£1,861
Offset mortgage near Oxford£1,776
Offset mortgage near Oxfordshire£1,658
Offset mortgage near Pembrokeshire£912
Offset mortgage near Pendle£541
Offset mortgage near Perth & Kinross£906
Offset mortgage near Peterborough£942
Offset mortgage near Plymouth£848
Offset mortgage near Portsmouth£972
Offset mortgage near Powys£939
Offset mortgage near Preston£599
Offset mortgage near Reading£1,257
Offset mortgage near Redbridge£1,834
Offset mortgage near Redcar & Cleveland£600
Offset mortgage near Redditch£980
Offset mortgage near Reigate & Banstead£1,845
Offset mortgage near Renfrewshire£558
Offset mortgage near Rhondda Cynon Taf£618
Offset mortgage near Ribble Valley£1,072
Offset mortgage near Richmond upon Thames£2,841
Offset mortgage near Richmondshire£985
Offset mortgage near Rochdale£735
Offset mortgage near Rochford£1,678
Offset mortgage near Rossendale£750
Offset mortgage near Rother£1,437
Offset mortgage near Rotherham£694
Offset mortgage near Rugby£1,164
Offset mortgage near Runnymede£1,875
Offset mortgage near Rushcliffe£1,342
Offset mortgage near Rushmoor£1,262
Offset mortgage near Rutland£1,499
Offset mortgage near Ryedale£1,148
Offset mortgage near Salford£820
Offset mortgage near Sandwell£765
Offset mortgage near Scarborough£818
Offset mortgage near Scotland£695
Offset mortgage near Scottish Borders£738
Offset mortgage near Sedgemoor£1,133
Offset mortgage near Sefton£795
Offset mortgage near Selby£1,007
Offset mortgage near Sevenoaks£2,003
Offset mortgage near Sheffield£837
Offset mortgage near Shetland Islands£810
Offset mortgage near Shropshire£1,093
Offset mortgage near Slough£1,246
Offset mortgage near Solihull£1,266
Offset mortgage near Somerset£1,158
Offset mortgage near Somerset West and Taunton£1,139
Offset mortgage near South Ayrshire£630
Offset mortgage near South Cambridgeshire£1,725
Offset mortgage near South Derbyshire£969
Offset mortgage near South East£1,496
Offset mortgage near South Gloucestershire£1,366
Offset mortgage near South Hams£1,478
Offset mortgage near South Holland£917
Offset mortgage near South Kesteven£1,041
Offset mortgage near South Lakeland£1,085
Offset mortgage near South Lanarkshire£612
Offset mortgage near South Norfolk£1,308
Offset mortgage near South Oxfordshire£1,968
Offset mortgage near South Ribble£806
Offset mortgage near South Somerset£1,104
Offset mortgage near South Staffordshire£1,123
Offset mortgage near South Tyneside£607
Offset mortgage near South West£1,238
Offset mortgage near South Yorkshire£719
Offset mortgage near Southampton£956
Offset mortgage near Southend-on-Sea£1,313
Offset mortgage near Southwark£2,097
Offset mortgage near Spelthorne£1,641
Offset mortgage near St Albans£2,282
Offset mortgage near St Helens£677
Offset mortgage near Stafford£987
Offset mortgage near Staffordshire£939
Offset mortgage near Staffordshire Moorlands£876
Offset mortgage near Stevenage£1,316
Offset mortgage near Stirling£924
Offset mortgage near Stockport£1,149
Offset mortgage near Stockton-on-Tees£633
Offset mortgage near Stoke-on-Trent£541
Offset mortgage near Stratford-on-Avon£1,469
Offset mortgage near Stroud£1,304
Offset mortgage near Suffolk£1,168
Offset mortgage near Sunderland£544
Offset mortgage near Surrey£2,006
Offset mortgage near Surrey Heath£1,785
Offset mortgage near Sutton£1,672
Offset mortgage near Swale£1,199
Offset mortgage near Swansea£733
Offset mortgage near Swindon£1,015
Offset mortgage near Tameside£803
Offset mortgage near Tamworth£899
Offset mortgage near Tandridge£1,977
Offset mortgage near Teignbridge£1,269
Offset mortgage near Telford and Wrekin£854
Offset mortgage near Tendring£1,090
Offset mortgage near Test Valley£1,534
Offset mortgage near Tewkesbury£1,359
Offset mortgage near Thanet£1,198
Offset mortgage near Three Rivers£2,202
Offset mortgage near Thurrock£1,274
Offset mortgage near Tonbridge and Malling£1,739
Offset mortgage near Torbay£1,007
Offset mortgage near Torfaen£750
Offset mortgage near Torridge£1,247
Offset mortgage near Tower Hamlets£1,835
Offset mortgage near Trafford£1,410
Offset mortgage near Tunbridge Wells£1,767
Offset mortgage near Tyne and Wear£653
Offset mortgage near United Kingdom£1,088
Offset mortgage near Uttlesford£1,770
Offset mortgage near Vale of Glamorgan£1,153
Offset mortgage near Vale of White Horse£1,626
Offset mortgage near Wakefield£752
Offset mortgage near Wales£814
Offset mortgage near Walsall£813
Offset mortgage near Waltham Forest£1,924
Offset mortgage near Wandsworth£2,410
Offset mortgage near Warrington£983
Offset mortgage near Warwick£1,418
Offset mortgage near Warwickshire£1,213
Offset mortgage near Watford£1,536
Offset mortgage near Waverley£2,145
Offset mortgage near Wealden£1,624
Offset mortgage near Welwyn Hatfield£1,640
Offset mortgage near West Berkshire£1,563
Offset mortgage near West Devon£1,211
Offset mortgage near West Dunbartonshire£521
Offset mortgage near West Lancashire£875
Offset mortgage near West Lindsey£837
Offset mortgage near West Lothian£794
Offset mortgage near West Midlands£895
Offset mortgage near West Midlands Region£964
Offset mortgage near West Northamptonshire£1,131
Offset mortgage near West Oxfordshire£1,545
Offset mortgage near West Suffolk£1,200
Offset mortgage near West Sussex£1,526
Offset mortgage near West Yorkshire£773
Offset mortgage near Wigan£716
Offset mortgage near Wiltshire£1,304
Offset mortgage near Winchester£1,903
Offset mortgage near Windsor & Maidenhead£2,108
Offset mortgage near Wirral£793
Offset mortgage near Woking£1,872
Offset mortgage near Wokingham£1,975
Offset mortgage near Wolverhampton£780
Offset mortgage near Worcester£987
Offset mortgage near Worcestershire£1,150
Offset mortgage near Worthing£1,323
Offset mortgage near Wrexham£767
Offset mortgage near Wychavon£1,329
Offset mortgage near Wyre£750
Offset mortgage near Wyre Forest£948
Offset mortgage near York£1,223
Offset mortgage near Yorkshire and The Humber£780