Mortgage Offset Calculator Australia

See exactly how many dollars and years an offset account may save on a home loan.

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Offset savings estimate

Interest without offset
$0.00
Interest with offset
$0.00
Interest saved
$0.00
Time saved
—
Estimated payoff
—

Assumes the original repayment stays unchanged and the offset balance grows by the entered deposit.

How a mortgage offset works

An offset account is a bank account linked to a home loan. Interest is charged on the loan balance minus the offset balance, while the regular repayment still reduces the loan. This can cut interest and shorten the loan.

How to use it

  1. Enter the loan amount, interest rate and remaining term.
  2. Add the current offset balance.
  3. Add any regular monthly amount you expect to keep in the offset.
  4. Compare interest and payoff time with and without the offset.

Worked example

On a $500,000 loan at 6% over 30 years, a $30,000 offset immediately reduces the balance used to calculate interest. Keeping the normal repayment and adding $500 to the offset each month can save substantial interest and years.

Benefits

  • Shows savings in both dollars and time.
  • Compares total interest side by side.
  • Models a growing offset balance.

Frequently asked questions

Does money in an offset earn interest?

Usually it reduces loan interest instead of earning separate savings interest.

Is an offset the same as redraw?

No. An offset is a separate transaction account; redraw is access to extra repayments already made to the loan.

Why does the calculator keep repayments unchanged?

Keeping repayments unchanged allows the interest saving to reduce principal faster and shorten the loan.

Are offset account fees included?

No. Compare any package fee or higher loan rate with the estimated saving.

Conclusion

An offset can be valuable when a meaningful balance is maintained. Compare the saving with account fees and lender conditions.