The Council of Mortgage Lenders today announced a 26% rise in the amount of offset mortgages that are taken out by UK borrowers.

An offset mortgage is basically where a mortgage is taken out with a high interest savings account at the same time. The amount that is in the savings account is then taken off of the full amount remaining on your mortgage. Then the interest is calculated from the remainder.

They also stated that the product is being under-used, and that a saving of approximately £29 billion could be achieved by mortgage holders using this technique.

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