Offset

How offset mode works

The interest payable on your linked home loan is calculated on the balance owing, less the balance of your Everyday Options account and any linked Sub-accounts (excluding any “flexiRates” you have). So you’ll pay less interest on your loan when you have money in your Everyday Options Account in offset mode.

To put it simply, the larger the balance you hold in your Everyday Options account and Sub-accounts, the less interest you’ll end up paying on your home loan.

Offset mode in action

For example, say you have $10,000 in your Everyday Options account, including $2,000 locked away in a flexiRate. You have $100,000 owing on your standard variable rate home loan.

When calculating your interest we’d subtract $8,000 (i.e. $10,000 – $2,000) from the $100,000 owing on your home loan, meaning you’ll only pay interest on $92,000. There’s no minimum amount required in your Everyday Options account to benefit from offset, which means every dollar you have in your account (excluding funds subject to FlexiRates) will save you interest on your home loan.

Interest is calculated daily, so you’ll benefit every day you keep your income and savings in your Everyday Options account (including any funds in your linked sub-accounts that are not flexiRates).

It’s important to remember that while your Everyday Options account is in offset mode, you won’t earn interest on any savings in the sub-accounts that you open. If you choose to lock away a portion of your money in a “flexiRate” you’ll continue to earn interest, but this money won’t count towards reducing the interest payable on your home loan.

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.

Example:

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