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C&G is set for move into offset mortgages

Cheltenham & Gloucester is hoping to enter the offset mortgage market at the start of next year following established players such as Woolwich and Intelligent Finance.

Intelligent Finance chief executive Grenville Turner says he does not expect C&G to launch a full offset product at first, predicting that it will enter the market with a current account mortgage.

Mainstream lenders are starting to look more closely at offset, which was previously classified as a niche area.

Abbey National launched a flexible loan with a savings offset feature in June with a view to entering the offset market fully if consumer reaction is positive.

C&G spokeswoman Susan Knight says: “Offset mortgages are something that we are keen to get into and we are currently looking at how to make this feasible.”

Turner says: “C&G has a good reputation locally but I expect they will not offer a full offset mortgage to start with, rather a cut-down version, the current account mortgage.

“A lot of lenders are dipping their toes in the offset market by introducing current account mortgages, which limit the amount the customer can offset against the mortgage.”

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