offset mortgages

[tali122]

are offset mortgages a far better option than repayment mortgages for a first time buyer? i understand how they work and the only negatives appear to be the no intrest on savings -are there any other drawbacks

[STAH]

They are a good idea if you maintain a healthy credit balance in your current account, or you have substantial sums in savings that you can offset the loan against.

Most first time buyers that I see at work opt for fixed rates - they are guaranteed stability and security with their mortgage payments for a set period.

Be that as it may be, your circumstances may be different. I would advise you to visit your bank to get advice on what type of mortgage to take out. Once you know what type you require, you can shop around to get the best deal.

Good luck!

[Hammer]

Two main drawbacks are they generally have a higher interest rate than traditional mortgages, and you need to be disciplined with yourself to make sure you actually chip away at the balance over time.