An offset account is a transaction account (non-interest earning) that is linked to a home loan account. The balance in this account is ‘offset’ daily against the outstanding loan balance thereby reducing interest payable on that loan. For example a $400,000 loan with $50,000 in offset means the interest expense is charged on $350,000. It is a great way to save money on your loan and is often the better than most saving accounts interest you would be earning.Ā Watch this video for more info on offset accounts.
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