Us consolidating debts

So if you need something for an emergency you can withdraw money without notice." Typically, offset mortgages are most suitable for higher-rate taxpayers and people with significant savings – as the more they can set against their mortgage, the less higher-rate tax they have to pay on deposits.

Offset mortgages can also offer higher earners a more flexible means of repayment, because this type of home loan allows borrowers to reduce debts whenever they wish by putting lump sums, such as bonuses or other windfalls, into their account.

Melanie Bien, director of independent mortgage broker Savills Private Finance, said: "No matter how many different debts you have, the most important is the mortgage, as this ensures you have a roof over your head." She said: "While it may be tempting to use any spare savings you have to reduce this debt more quickly, remember that the money used to do this is very difficult, if not impossible, to get back out if you need it, so it is crucial to keep cash in an easy access account for emergencies." Ms Bien explained that a good compromise might be an offset mortgage.

She said: "This enables you to offset your savings against your mortgage debt, reducing the interest you pay on the latter while your savings remain accessible.

Plus, if you don’t have an emergency fund, consider setting some money aside in savings beforehand.A golden rule for those transferring their balances is never spend more money on the credit card when you have transferred your balance.This new debt will be repayable at an expensive, higher rate, and you will often not be able to pay it back until you have paid back the cheaper debt already accrued.If you already have outstanding personal loans, these rates are worth comparing, too.But keep in mind that rates have risen substantially over the past 12 months, and anyone who grabbed a best-buy loan in the past couple of years may struggle to better that rate today.

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