offset mortgages

1eleonar

my hubby and I are thinking about moving our mortgage to an offset mortgage. at present we owe £26, 500 on our mortgage, but plan to borrow and extra £5,500 on it for home improvements.
Does anyone have an offset mortgage, anyone any experiences of one (good or bad), are they too good to be true, and would anyone recommend having one.
We have no debt, credit card bills, anything along those lines. The only money we owe is our mortgage. But we don't have any savings (well only £2000) to put into the offset account when/if we set it up.
Any advice/experiences etc would be greatly appreciated.

Trying_to_be_good

Offset mortgages are only worthwhile if you have savings - are you planning on building up significant savings quickly? Otherwise there's nothing to offset, and you'd be better off chasing a lower rate mortgage.

Nice_guy

Hi 1eleonar,

I agree with what 'trying to be good' is saying. From the research I have done into offsets they are only worth it if you have a decent amount of savings. Don't forget offset mortgages are normally charged at a higher interest rate so if you have nothing/little to offset then it effectively works out as just having an expensive mortgage.

Here's a good link to fill you in a little more about offsets:
http://forums.moneysavingexpert.com/...ead.html?t=471

Hope that helps!
Nice_guy