Mortgage Offset

How offset mode works

Home Loan Interest is calculated on the outstanding balance of your linked Standard Variable home loan, less the balance of your main Everyday Options Account and linked Sub-account balance/s.  

This means the more money you have in your Everyday Options Account and sub-accounts the less interest you’ll be charged on your home loan.

And because sub-account balances are included in the offset calculation, you can maximise any savings you have to receive a multi-offset benefit.

It is important to understand that while the Everyday Options Main and any Sub Account/s are in Offset mode you won’t earn interest on any balance in the account/s. flexiRates are another savings option, where the funds are fixed for a set period of time. When your Everyday Options Main and any Sub Account/s are in offset mode, you still have the option to set up flexiRates on your account/s however any balances in a flexiRate will not offset the home loan, while the flexiRate is active. If your flexiRate matures or is released back into the Everyday Options Main and any Sub Account/s, they will automatically start offsetting again.

Offset mode in action

Example:

You have $100,000 owing on your Standard Variable home loan

You have an Everyday Options Account with the following balances:

• Main account $2,000
• Total Sub-account balances $5,000 (of which $1,000 is locked away in a sub-account flexiRate).

When calculating your home loan interest, we’d add your Everyday Options Account balances together i.e. $2,000 + $5,000 = $7,000 less the flexiRate balance of $1,000 = $6,000.

This is the multi-offset value that can then be subtracted from your $100,000 home loan when calculating interest. You’ll only pay interest on $94,000.

Every cent counts

There’s no minimum amount required in your Everyday Options Account to benefit from offset, which means every dollar you have in your main account and sub-account balances can save you interest on your Standard Variable home loan.

Depositing your pay into your main Everyday Options Account and using your sub-accounts for regular bills is one way to maximise this benefit with every cent you earn work harder for you reducing your home loan interest.

Click here for full details on our Everyday Options Account.

Fees

A once off $75.00 Mortgage Offset Fee is charged to your linked loan account when your loan is not held in a Home Package Plus.

Example:

The table below illustrates three examples of how deposit balances in Everyday Options Accounts operate in offset mode and reduce the interest payable on a linked home loan.