Oneaccount mortgage

[Jbck]

Anyone got one of these either with Oneaccount or another lender. Do you like it, can you keep track of everything & do you find you make overpayments easier without really thinking about it? I suspect money you'd normally have frittered away or don't necessarily do something specific with makes a dent in your borrowing because it's just sitting there without you making a conscious effort to make an overpayment into another account. These sound too good to be true & I'd like to know if anyone's had a bad experience.

We've had one for just over a year now and don't plan to change back.
We put all our savings in to it, so effectively have none. However the limit on what we can borrow is about £20k above what we have borrowed, so we are secure in that we can afford anything which our savings would have provided.
We put all our shopping on a credit card each month and clear the balance (by dd so no chance of forgetting) each month, thus incurring no charges. The interest on a one account mortgage is calculated daily, so the shopping that goes on the cc is free untill the cc is paid off, IYSWIM.
Each month an interest charge is made, usually around £300 which I think is considerably less than the amount of int. we would be paying on a regular mortgage, so when I see that on the statement I just consider it as a mortgge payment.
It works for us as we're not frivolous. We buy what we need. I have a freind who uses her cc as extra money then panics when the bill comes in- if that's you then don't do it. We control our spending. Everything that can go on a cc does. Everything else comes straight out of the one account. Some months the balance comes down £800, some months £400, and this month I think it will go up as we have had the garden landscaped, the cost of that is about half our income. So it enables you to manipulate your money IYSWIM, no point in borrowing from different loans etc and having or not having savings etc, it's just all together and provided you're sensible it's great.
We have ours with the Clydesdale Bank. They give you an info pack which has a floppy disk, you enter all your income and expenditure, (you really have to think what you'd spend on everything- birthdays, hair, the lot) and it produces a pretty accurate graph which is very impressive IMO! At the time we went for it, we were predicted to have paid ours off within 6 yrs. Dh was earning just short of £40k, I was just less than £10k, our mortgage was less than £80, but within 6 months we had a baby, my earnings ceased, and dh changed jobs and reduced income to less than £30k. So, rather than having a hefty payment to meet each month that we had committed to when our earnings were high, we just had to tick over to when we knew he'd be earning more. So effectively we got slightly more overdrawn but knew that we'd be making a bigger dent in a couple of months. I'm starting to rabble now so just ask any more questions if you want!

We don't have the full on oneaccount - we have an offset arrangement. The mortgage and savings are kept in separate accounts but the savings balance is used to offset the mortgage. So the interest is only worked out on the net figure eg mortgage 50K, savings 10K, interest worked out on 40K. the current accounts are also included and we do a similar thing to brambalina with the credit card. That way the current account balance stays as large as possible for as long as possible.

You do need to have a decent amount of savings to make it worthwhile but even over the last few months when we've had less than usual we've paid £300 less interest this quarter. We get a quarterly statement that shows what we would have paid had the accounts been separate and what we actually did pay. The monthly mortgage payment stays the same so we will end up apying it off earlier.

Ours is with the Natwest. Think the interest rate is slightly higher than with a standard mortgage so you need to see if it would be worthwhile for you.

We have the Barclay's equivalent (Openplan). I like it because I don't have to worry about it.

Thanks folks, I'm going to check out a few as I've seen some varying interest rates with them.
Bramblina, when you say an interest payment do you mean your monthly mortgage payment or something else? Ours would be capital & interest is yours an endowment mortgage.

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Jbck, ours is not an endowment. I mean that interest is taken from our account.

I'm not sure if you're sure how they work, and don't want to sound condescending, but imagine it as a very large overdraft. Eg if our mortgage was £70k, we had savings in another account of £5k, we got it all up and running, our total morgage in this account would be £65k, overdrawn IYSWIM -as I say imagine it as a huge od. It runs as a current account, so our wages, child benefit etc all get paid in, our counsil tax, phone bills etc all come out as direct debits, and the credit card payment comes off each month too. As a normal mortgage payment of £500 would probably be made up of £400 interest on what is still owed and £100 of capital, the one account works similarly, in that they need to chrge interest on what we still owe, as I said that is calculated daily (that's why everything goes on cc so it "floats" for the best part of a month before it has to be paid) and interest is paid.

We don't make a payment as such, but if you imagine that we did have a mortgage of the £65 mentioned, we would have set our limit as perhaps £85 as a buffer- (remember all your savings go in here, so you have nothing if you need to buy a new car, carpets etc, the things your savings would normally be hanging around for), well each month this limit reduces, so that at the end of the 25yr term it will have come to zero, therefore if you are overdrawn to your limit (ie not using the one account as it could be) all the time, it will have been reduceing, therefore paying your mortgage off. The idea, like huge overdraft, would be to get it paid off as soon as possiblr, bringing your balance closer to zero as quickly as possible. The benefit is- where you may be getting say, 1 or 2% interest on your savings, but paying maybe 5 or 6% on your interest, if you can have them both in the same account but not have committed to using up all your savings and frrling a bit insecure, you pay interest on as little as possible, IYSWIM.

Not explained very weel, I could do with drawing a wee chart! HTH anyway!

Ours is capital and interest not endowment. Been there done that .

We make specific payments to ours as mentioned below.

We have an Intelligent Finance offset account system with lots of "pots" of savings. Worked out last night that we have shaved five years off our mortgage by overpaying and offsetting using 0% credit cards. Wouldn't go back the old style in a million years! (Ours is repayment and interest, by the way.)