How you can interest via an offset account, and what it can do for your mortgage

An offset account is a separate transactional account which sets off against a linked mortgage. For example, a $1,000,000 loan would only incur interest on $950,000 if there was $50,000 of cash inside the offset account.

With a normal principle & interest repayment, you simply pay more principle in place of the interest you save, meaning the monthly repayment doesn’t change although the term of the loan does shorten as a result.

If you placed $75,000 into offset on the $1,000,000 from the outset, at a 3% interest rate, 30-year term, you would save $100,091 over the life of the loan, and the term of the loan would shorten by 2 years.

We have a range of calculators which allow you to determine offset account savings – please reach out with any questions. Tom.


Written by Tom Morison

I have a genuine desire to create a strong reassuring sense of trust, confidence and satisfaction for my clients. It’s important that I provide you with the knowledge I have so you can make the best decisions for yourself with my guidance.
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