100% Offset Account

Home loans with 100% offset accounts may help you to decrease the amount of interest you pay on your home loan. They work by a structure of depositing your salary straight into an offset account. The benefit is that you immediately reduce the amount of interest you are paying.

Use your day-to-day savings to reduce your interest

A quick guide to 100% Offset Mortgages:

• Links your home loan to an offset transaction account.
• For the purpose of calculating interest, the balance of your mortgage account is reduced by 100% of the balance of your linked transaction account.
• The more money you keep in your transaction account the less interest you pay on your mortgage.
• The key to success with the offset transaction account is to grow your savings and leave these funds in the account as long as possible.
• You still have access to these funds whenever you need them.

This is one of the most powerful ways to save you hundreds of thousands of dollars over the lifetime of your mortgage.

A “100 percent offset account” can sound too good to be true. You cannot be more wrong because with an offset account you will be able to have every cent of your money working for you to:

• Reduce your mortgage
• Rather than sitting idly in your cheque or savings account

If you decide to put as much of your spare cash as you can into an offset account, and keep it in the offset account for as many days as possible each month then:

• Your home loan repayments can be reduced, because your savings are bringing down the interest incurred, and
• In effect “offsetting” the cost of your home loan

It is very important to use this account the correct way especially for first home buyers who purchase an owner occupied property first and then want to switch it to an investment property in a few years time. Not using it properly can be detrimental to the loan amount used to get a tax rebate. For more information come to our info sessions for first home buyers.