From 24 April 2005, Intelligent Finance will be offering six offset mortgages including two-year tracker products, a tracker for the term of the mortgage and an improved discounted offset.
ICM Research commissioned by Intelligent Finance showed that 44% of UK adults say that they have heard of the principle of offset banking products. This is almost double the number who claimed to be aware of offset when the bank asked the question two years ago.
Intelligent Finance's Managing Director, Nick Robinson, said: "When Intelligent Finance launched in 2000, there were only a handful of lenders offering offset or current account mortgages. Any new financial product in the UK needs to battle consumer lethargy and low awareness of financial products. However, our experience and the results of our research reveal that for offset this situation is changing rapidly."
The research also revealed that 44% of people – that's some 2.8 million adults – who say they are planning to take out a mortgage in the next year or two, have already decided to offset or are considering taking out an offset mortgage.
As the market is maturing, Intelligent Finance is now extending the range of offset products available to consumers to enable them to find a product that offers better value for their individual circumstances. As well as the option of tracker and discounted offset products with Intelligent Finance, mortgage applicants will be able to choose from products priced according to Loan-to-Value (LTV).
Nick added: "We have been providing offset mortgages in the UK for almost five years. When we launched in 2000, offset was a new concept. Many more lenders have now entered the offset market. Most, however, offer simplified products which only enable offsetting between a mortgage and a savings account. Intelligent Finance remains the only provider which allows customers to offset all their current account and savings balances, including ISAs, held with the bank. As awareness and knowledge of the offset product has increased amongst UK consumers, we can use our own specialist knowledge of offset customers to provide a product range which gives more targeted options for those considering offset."
ICM's research revealed that 10% of the country's mortgage borrowers are now using offset, which means that some 2.5 million adults in the UK now use offset banking for their day-to-day banking needs. A further 44% of the UK population are considering offset mortgages in the next couple of years, which equates to a further 2.8 million, meaning that the offset market has the potential to double in just two years.
Nick concluded: "By extending our offset range, we are giving brokers the necessary tools to maximise the potential of offset. Clients' needs are individual and varied and the extended offset range will allow brokers to offer products more tailored to the specific needs of their clients. This will move Intelligent Finance from a 'one size fits all' offset lender to a lender with a product tailored to individual circumstances and enable the bank to maintain its position as an offset innovator in a rapidly maturing offset market. We will be backing up this investment in the offset market by doubling our advertising spend in both consumer and trade press during the launch period."
The bank is also expanding its standalone tracker and fixed rate mortgage range and all new mortgages will also be available to existing mortgage customers moving home.
