Are offset mortgages a good idea?

Q I've read the blurbs on offset mortgages, and they seem like a terrific idea. Is there a downside?

MT

A Offset mortgages have a lot going for them and no discernible faults. However, they are really designed for the more financially sophisticated individual who is aware of what is going on.

The main danger that offset mortgages present is that they are too flexible as a convenient way of borrowing money. Because it is so easy to borrow with them, using the drawdown facility, some people are encouraged to build up their debts rather than reduce them.

This could end up placing you in serious difficulties, especially if interest rates began to rise - or if there was a crash in the property market. To make the point, one specialist adviser said offset mortgages reminded him of endowment policies. They were very good for a certain type of borrower, but were being oversold to a much wider audience - with potentially disastrous consequences.