ISA mortgage

By THIS IS MONEY
Updated:

 

I have an ISA mortgage with the Halifax. Can I switch to another ISA provider? I.I., Basingtoke

Justin Modray from independent financial advisers Chase de Vere says: When you use an ISA to repay a mortgage the ISA can be with any ISA manager and does not have to be with your lender. You can use Halifax's own range of ISAs, which are reasonable, but you might do better to choose a specialist ISA fund management company to provider a wider choice of funds and greater performance potential.

In choosing a group you need to watch out for charges as well as performance and fund choice. Groups you might consider include Fidelity, Jupiter, Invesco and Save & Prosper.

You can switch your on-going savings between different ISA managers each tax year. This is a good idea, as you will not end up with all your eggs in one basket. So for next tax year, starting April 6th, you can take out a new ISA with a different ISA manager. You cannot switch during the year as you can only take out one stocks and shares ISA with one manager in any tax year.

Halifax offers a product called Homeplan, which includes your mortgage, its ISA that you use to repay the loan and life insurance. If you bought this product rather than a straightforward ISA to pay back your loan and you switch, you need to reassess your life insurance needs.

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