Home Loan Offset Calculator
Work out how much interest you could potentially save with a home loan offset calculator.
Don’t let your savings sit idle in a low-interest bank account. With an Offset Account, every dollar you save reduces the interest you pay on your mortgage. Use our offset calculator to see how much time and money you could save by simply changing where you keep your cash.
Why an Offset Account is Beneficial
In today’s market, an offset account is one of the most effective financial tools available. Unlike a traditional savings account where you pay tax on the interest earned, an offset account saves you mortgage interest – which is often at a much higher rate and is effectively tax-free savings.
Key Benefits:
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100% Offset: Every cent in your linked account is offset against your loan balance.
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Daily Interest Calculation: Interest is calculated daily, so even short-term cash boosts to an offset account help.
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Full Liquidity: Your money isn’t locked away. Spend it, move it, or save it whenever you need.
Frequently Asked Questions (Offset Accounts)
Q. How does an offset account actually work?
A. Think of it as a pair of scales. On one side is your loan balance (e.g. $500,000), and on the other is your offset account balance (e.g., $50,000). Interest is only charged on the difference ($450,000). By having an offset account, you effectively shrink your loan balance for interest purposes without actually giving the money to the bank.
Q. Is there a difference between an offset account and a redraw facility?
A. Yes. While both save you interest, an Offset Account is a separate transaction account with a debit card and easy access (like a normal bank account). A Redraw Facility involves putting extra money directly into your loan. To get that money back out, you usually have to request a redraw, which may have minimum limits or different tax implications for investment properties.
Q. Are there fees for an offset account?
A. Many lenders do charge a monthly or annual fee for an offset account. Our calculator helps you determine if the interest savings outweigh any potential account fees.
