One account - opinions/talk me out of it?

[Lucas CAV]

Any opinions, good or bad, on The One account?

I have a relatively small mortgage and due to a combination of too much work and not enough play, a fair chunk of savings scattered across various accounts/ISAs etc.

The savings are doing nothing, interest wise and the mortgage currently has around 15 years to go.


I am considering The One account - put the accumulated cash into it, along with the mortgage - as I understand it - this will effective give me a negative balance equal to the remainder of the mortgage ?

The opportunity to reach zero balance in a couple of years seems very appealing - and achievable.


What am I missing?


edit to add - without getting too specific - the cash represents around 80% of the outstanding mortgage.

Edited by Lucas CAV on Wednesday 4th August 13:47

[Dave_ST220]

Sounds like a no brainer to me, I changed last year and so far it reckons I'll be mortgage free in a few years. I got sick of seeing large chunks of cash earn fk all(& get taxed!) so shifted the lot into it. Every time I bang another £10k in there the graph drops like Lloyds shares did when the st hit the fan! At the moment I see no down sides, even if rates rise...

ETA, yes, the balance is negative, so even if you had £100k in savings but the mortgage is more then the statement is negative.

Edited by Dave_ST220 on Wednesday 4th August 15:37

[Fume troll]

I've got the Woolwich equivalent, it has saved me a fortune.

Cheers,

FT.

[ringram]

These days it makes a very good case for itself. In effect the savings are tax free too!

[Dave_ST220]

Yep because they are offsetting a debt.

[worsy]

One account mortgage rate is 3.75, Firstdirect equiv is 2.49%

http://www2.firstdirect.com/1/2/mortgages/offset-m...

Assuming 65% LTV

[Dave_ST220]

But the one account does not track base rate?

[worsy]

Dave_ST220 said:

But the one account does not track base rate?

True, but are you suggesting that when interest rates go up the one account won't?

[Dave_ST220]

Not at all, but what I am saying is they won't necessarily go up by base + 3.75%.

[Dave_ST220]

or 3.25%

[worsy]

True they could be base +5%

[Dave_ST220]

They won't have many customers left then.........

[Dave_ST220]

Found this :-

Date / change /BBR / How rate treated / OA% / Margin
10/Dec/88 -0.50 6.25% passed on 7.45% 1.20%
7/Jan/99 -0.25 6.00% passed on 7.20% 1.20%
4/Feb/99 -0.50 5.50% passed on 6.70% 1.20%
8/Apr/99 -0.25 5.25% passed (Est) 6.45% 1.20%
10/Jun/99 -0.25 5.00% passed (Est) 6.20% 1.20%
8/Sep/99 0.25 5.25% passed (Est) 6.45% 1.20%
4/Nov/99 0.25 5.50% passed (Est) 6.70% 1.20%
14/Jan/00 0.25 5.75% passed (Est) 6.95% 1.20%
10/Feb/00 0.25 6.00% passed (Est) 7.20% 1.20%
8/Feb/01 -0.25 5.75% passed (Est) 6.95% 1.20%
5/Apr/01 -0.25 5.50% passed (Est) 6.70% 1.20%
10/May/01 -0.25 5.25% passed (Est) 6.45% 1.20%
2/Aug/01 -0.25 5.00% passed (Est) 6.20% 1.20%
19/Sep/01 -0.25 4.75% passed (Est) 5.95% 1.20%
3/Oct/01 -0.25 4.50% passed (Est) 5.70% 1.20%
8/Nov/01 -0.50 4.00% passed (Est) 5.20% 1.20%
6/Feb/03 -0.25 3.75% passed on 4.95% 1.20%
10/Jul/03 -0.25 3.50% passed on 4.70% 1.20%
16/Nov/03 0.25 3.75% passed on 4.95% 1.20%
5/Feb/04 0.25 4.00% passed on 5.20% 1.20%
6/May/04 0.25 4.25% passed on 5.45% 1.20%
10/Jun/04 0.25 4.50% passed on 5.70% 1.20%
5/Aug/04 0.25 4.75% passed on 5.95% 1.20%
4/Aug/05 -0.25 4.50% no ……………. 5.95% 1.45%
1/Sep/05 0.00 4.50% decrease 0.25 5.70% 1.20%
3/Aug/06 0.25 4.75% passed on 5.95% 1.20%
9/Nov/06 0.25 5.00% passed on 6.20% 1.20%
11/Jan/07 0.25 5.25% passed on 6.45% 1.20%
19/May/07 0.25 5.50% passed on 6.70% 1.20%
5/Jul/07 0.25 5.75% passed on 6.95% 1.20%
6/Dec/07 -0.25 5.50% passed on 6.70% 1.20%
7/Feb/08 -0.25 5.25% passed on 6.45% 1.20%
10/Apr/08 -0.25 5.00% no ……………. 6.45% 1.45%
7/Jul/08 0.00 5.00% increase 0.5 6.70% 1.70%
8/Oct/08 -0.50 4.50% no ……………. 6.70% 2.20%
3/Nov/08 0.00 4.50% decrease 0.5 6.20% 1.70%
6/Nov/08 -1.50 3.00% no ……………. 6.20% 3.20%
1/Dec/08 0.00 3.00% decrease 1.0 5.20% 2.20%
4/Dec/08 -1.00 2.00% no ……………. 5.20% 3.20%
31/Dec/08 0.00 2.00% decrease 1.0 4.20% 2.20%
8/Jan/09 -0.50 1.50% no ……………. 4.20% 2.70%
2/Feb/09 0.00 1.50% decrease 0.2 4.00% 2.50%
5/Feb/09 -0.50 1.00% no ……………. 4.00% 3.00%
5/Mar/09 -0.50 0.50% no ……………. 4.00% 3.50%
1/Apr/09 0.00 0.50% decrease 0.25 3.75% 3.25%
7/May/09 0.00 0.50% n/a ……………. 3.75% 3.25%

[Fatsterjack]

That says it all really.

Considering a FD Offset tracker currently - personally would avoid the One Account at the moment.

[Nano2nd]

i've got one and love it, yes you pay for the flexiblity with a slightly higher rate, though if your virtualy going to be postive that won't matter much. I don't think i could go back to a regular mortgage/curr acc now!

works well if your "stoozing" too

if you decide to go for it let me know and i'll recommend you, we'll both get £125

[Dave_ST220]

Oi! Post 2 was recommending!

[Nano2nd]

Dave_ST220 said:

Oi! Post 2 was recommending!

u never mentioned anything about recommending the guy

[si2085]

It does sound tempting.

A question to existing users - is the One account easy to use for budgeting on a day to day basis, given that your balance is likely to be one large debt? For example, does the online banking allow you to split your funds making it easier to budget?

[NobleGuy]

Lucas CAV said:

I am considering The One account - put the accumulated cash into it, along with the mortgage - as I understand it - this will effective give me a negative balance equal to the remainder of the mortgage ?

Yep. Exactly right. I went over to them about a year ago and it's been great. The interest gets charged monthly as it would for a 'normal' overdrawn bank account.

Any windfall or spare cash can go into it to reduce the mortgage interest. If the crap hits the fan and you lose your job for example (and you are ahead of the schedule) you can make use of the buffer you've built up and not stress about the bank suddenly getting shirty straight away.

Only risk I can see is that when your statement says "You are £23,456.78 ahead of schedule" there's the temptation to spend

[Mattt]

One thing I'd watch - and I'm only guessing here - is that if the Bank went under, your savings over the £50k protected limit would be wiped out, yet the debt would remain.

Anyone care to correct me?