£2 million interest-only offset mortgage arranged for private equity partner wanting to keep savings liquid

Trinity Financial arranged an interest-only offset mortgage for an existing client who works as a partner in a private equity firm.

The client originally planned to pay down the mortgage using their savings. While this would have reduced the mortgage balance, it would also have used up a large amount of their liquid funds. After reviewing the client’s wider financial position, Trinity’s broker suggested an offset mortgage instead.

This allowed the client to keep their savings accessible while using the funds to reduce the interest charged on the mortgage.

Why did the client need Trinity Financial’s help?

The client was a repeat customer and contacted Trinity Financial around six months before their existing mortgage deal was due to expire.

They wanted to understand the best way to manage the mortgage while retaining flexibility. Although they had enough savings to offset the mortgage fully, they did not want to lose access to the money by paying it permanently into the mortgage.

An offset mortgage gave them the ability to hold their savings in a linked account. These funds can reduce the amount of mortgage interest charged, while remaining available to withdraw and repay as needed.

Which lender was selected?

Trinity Financial recommended Accord because the lender allows offset mortgages on an interest-only basis.

The mortgage was arranged as a two-year fixed rate at just below 4.15%. The client chose an interest-only structure, which suited their financial position and helped them keep monthly payments lower.

Why was an offset mortgage useful?

An offset mortgage can be helpful for borrowers with large savings, bonuses, business proceeds or other funds they may want to keep accessible.

Rather than earning interest in a separate savings account, the money is linked to the mortgage and used to offset the balance on which interest is charged. This can reduce the overall interest cost while maintaining flexibility.

In this case, the client had the funds available to offset the mortgage entirely, but the structure meant they could still withdraw and replace money when needed.

Offset mortgages can be extremely useful for high earners and clients with significant savings who do not want to tie up all of their cash by paying down the mortgage permanently.

In this case, the client could have reduced the mortgage using savings, but that would have limited their liquidity. The offset structure gave them the best of both worlds — they could reduce the interest charged while keeping access to their funds.

Not every lender offers interest-only offset mortgages, so it is important to speak to a broker who understands which banks and building societies can support this type of structure.

How Trinity Financial's broker helped

Trinity Financial’s broker helped the client:

• Review their mortgage six months before the existing deal expired

• Consider whether paying down the mortgage was the right option

• Identify an offset mortgage as a more flexible solution

• Keep savings liquid and accessible

• Arrange an interest-only offset mortgage

• Secure a two-year fixed rate at just below 4.15%

• Use Accord as a lender offering offset mortgages on interest-only

Speak to Trinity Financial

If you have savings, bonuses or investment proceeds and want to reduce your mortgage interest while keeping access to your money, an offset mortgage may be worth considering.

Trinity Financial’s brokers can compare offset, interest-only, fixed-rate and tracker mortgage options to help you decide which structure works best for your circumstances.

Call Trinity Financial on 020 7016 0790, book a consultation, or use our appointment calendar.

The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.

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