According to the Council of Mortgage Lenders (CML), the number of people opting for an offset mortgage has grown.

During 2006, 170,000 offset mortgages were taken out worth £29.3bn, equivalent to 7% of all new lending. And the year-on-year growth of offset mortgages between April 2006 and March this year was 49% (by value) compared to 15% for non-offset lending. Offset mortgages combine a mortgage and savings in one account, and can offer borrowers a number of advantages including the option to make on over-payment or an under-payment on the mortgage.

Phoebe Zhang, author of the research and CML statistician, said: “Todays research reflects the dynamic nature of the UK mortgage market. Mortgage lenders are constantly developing new products to meet the needs of borrowers and the fact there are now 250 offset products available in the market illustrates this.
“Going forward, continued innovation by lenders will help to increase consumer awareness of offset products, and expand the market potential for offsets in the future.”