Offset account calculator
How much could an offset save you?
An offset account is a transaction account linked to your home loan, where the balance is subtracted from your loan before interest is charged. Hold $50,000 against a $500,000 loan and you only pay interest on $450,000. Enter your numbers below to see the indicative interest and time an offset could save, then talk to a broker.
Indicative only. Not credit assistance. [ASSUMPTION] Assumes a constant rate and a constant offset balance for the life of the loan and that repayments stay at the original contractual amount. Real savings change as your balance, rate and repayments move. Confirm with a CLS broker.
How it works
How does an offset account work?
An offset account is an everyday account linked to your home loan. Its balance is deducted from your loan balance before interest is calculated, so the money in offset works like an extra repayment without locking it away. The larger the offset balance and the longer it sits there, the more interest you save.
| Feature | Offset account | Extra repayments |
|---|---|---|
| Interest saving | Yes, on the offset balance | Yes, on the amount repaid |
| Access to the money | Withdraw any time | Only via redraw, if available |
| Good for | Emergency buffer, savings, salary | Disciplined paydown |
| Possible cost | Higher rate or package fee on some loans | Usually none |
Straight answer
Will a broker charge to set up an offset loan?
No. Central Lending Solutions compares offset loans across more than 30 lenders and most clients pay us no fee, because the lender pays our commission when your loan settles. We are bound by the Best Interests Duty, in force since 1 January 2021, so we weigh any offset cost against the saving for you.
Common questions
Offset account FAQs.
How does an offset account work?
An offset account is a transaction account linked to your home loan. The balance in it is subtracted from your loan balance before interest is charged. If you owe $500,000 and hold $50,000 in offset, you only pay interest on $450,000, which cuts interest and shortens the loan.
Is an offset account better than paying down the loan?
An offset gives a similar interest saving to paying down the loan but keeps your money accessible. You can withdraw the offset balance any time, which suits an emergency buffer or savings you may need. A broker can tell you whether an offset or extra repayments suits you better.
Do offset accounts cost extra?
Some loans with an offset account charge a higher rate or an annual package fee. Whether the interest saving outweighs the cost depends on your offset balance. A Perth broker compares loans with and without an offset across more than 30 lenders to find the best net result for you.
Are these offset savings guaranteed?
No. The figures are indicative and assume a constant rate and offset balance over the life of the loan. Real savings change as your balance, rate and repayments move. Book a free chat with Central Lending Solutions to model your actual situation.
Here to help
Make your savings work harder.
Book a free chat with a named Perth broker. We will compare offset loans across more than 30 lenders and model your real saving. Most clients pay no fee.
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