Offset Loan

Offset Loan

A type of loan in which the borrower maintains a savings account with the lender so that the account balance is netted against the loan outstanding for purpose of interest calculation. The interest rate on Offset loans is typically higher than the ones without this feature.
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The bank said that its profit had dropped in the latest quarter, as merger-related costs offset loan and deposit growth.
With The Carrington Loan, there is no need to modify the rate after it is presented to the borrower to offset loan costs and loan closing fees, and unexpected increases to estimated closing costs are not an issue.
Your existing lender may offer an offset loan, or consider First Direct (0800 482448), which has recently been offering this scheme at 2.
Or, if you can't afford to say goodbye to your savings, see how much you could gain by transferring to an offset loan.
A family offset loan, where your parents' saving are set against your debt, will also allow you to borrow more at a reduced cost
The primary cause of the year-to-date loss was the loan loss provision recorded during the year to offset loan charge-offs as the recession adversely affected several loans.
That means tens of thousands would suddenly be better off with an offset loan -if only they knew what they actually are.
A borrower with a pounds 100,000 offset loan from Woolwich at 3.
Given the existing capital markets and QVC's operational issues, Liberty's portfolio of cash and marketable securities could become ever more important over the intermediate term to handle these maturities and offset loan reductions, tight credit markets, and higher interest expense.
By renting out a spare room for five years, says the bank, a homeowner with an offset loan who puts monthly rents into mortgage overpayments saves a four figure sum in interest.
IF YOU have savings and a mortgage, you can make your money work harder by switching to an offset loan.