Hi Dan42 – Interest only with off-set is available with most lenders. I recently had a client run in to a problem using off-set like this. He had a 300k investment loan and 301k in offset – he paid no interest for 3 years. When he eventually used the funds in off-set for a  new home he assumed it was tax deductable as the loan had not changed. When he was audited the auditor did not allow the deduction as the cost (interest) only occurred after the funds were drawn out of off-set account – therefore they now associated the cost to the new purpose. It was new to me and I've been a banker for 10 years. Best not rely of a banker or brokers advice – talk to a tax accountant.