Advisers should, however, be aware that with some of these societies the client may need to be within the geographical field of vision for the lender to take them on. The Vernon, for instance, will only lend within a 25-mile radius of Stockport. Another point to be aware of is advisers' dealings with these lenders.
It may be that you have not dealt with one of the smaller societies before and this may make you somewhat uncomfortable. It should not, but there is no cause to worry about this because there are specialist packagers active in this market who have access to these lenders and have a strong relationship with them. Referring your clients to them might well be the best option in order to take advantage of their case expertise.
Overall, there is no doubt that, for certain client types, the offset mortgage should be a consideration when they come to look at their product options. As mentioned, it may well be that you have clients who are simply unhappy with the punitive interest rates offered for easy access accounts. Or there may be higher rate taxpayers who should also consider offsets as taking this option means their savings will attract no interest and they will not have to declare this as taxable income.
Self-employed applicants can also use money set aside to pay their tax bill to offset and landlords can have their rental income paid into a savings account linked to their own residential offset, which can help reduce their own mortgage interest.
Some lenders allow business accounts to be linked to offset mortgages, but generally the name on the business account would need to match the name on the mortgage so it would normally be sole traders or partnerships that could do this.
Finally, some lenders also allow family members to link their saving accounts to a mortgage of a relative. This can be useful where parents want to help out children with paying a mortgage debt, but not actually gift them the whole amount.
Overall, and certainly for advisers, I suspect there will be some clients within your client bank that, at the very least, should be considering the use of an offset mortgage. In years gone by, the discrepancy in pricing between offsets and normal mortgages was seen as offputting to borrowers focused on monthly payments. However, pricing differentials have narrowed and the money that can be saved over the longer term should also be taken fully into account.
