Mortgage Calculator
Important notice: All computations are for illustrative purposes and do not constitute advice or a guarantee of a loan approval.
How Does An Offset Mortgage Work?
When you choose an offset mortgage, you are linking a savings account or everyday transaction account to your mortgage account. Then the money sitting in the savings account is treated as if you had made a payment towards your mortgage.
For example, imagine you have a $500,000 mortgage. You also have a savings or transaction offset account attached to your mortgage with a value of $50,000. Instead of earning monthly interest on your $50,000 your monthly mortgage interest will be charged on $450,000 instead of the full $500,000.
This example is based on a standard 100% offset mortgage. However, there are different options for offset mortgages including:
- 100% offset account
- partial offset account which works on the interest percentage, and
- partial offset account with a fixed percentage used towards the mortgage
As with the various mortgages available on the market, all loan options have pros and cons. The best way to ensure you find the right mortgage for your situation is to talk to an expert who knows and understands the market. So, why not book a time to chat with our experienced MFAA mortgage brokers today by clicking the link below…
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