Offset Account
Reduce the interest you pay on your home loan every day—while keeping your money accessible for real life.
Award-winning lending specialist since 1986.
Australian Credit Licence 393283.
- 100% interest offset against eligible Mortgage House home loans
- Up to 10 offset accounts, with separate cards to organise goals
- Daily offsetting means your money works immediately
- Variable rate: no offset interest saving cap
- Fixed rate: offset benefit capped at $20,000
What is an offset account?
An offset account is a transaction account linked to your home loan. The balance in the offset account reduces the loan balance used to calculate interest—so you may pay less interest while keeping access to your funds.
Interest savings limits:
- Variable rate home loans: No interest saving cap from the offset feature (savings depend on balances and loan terms).
- Fixed rate home loans: Offset benefit is capped to $20,000.00 per annum (include: cap applies to the portion of fixed loan balance eligible under product rules).
Offset features and caps vary by product. Eligibility, fees, and conditions apply. Talk to us before relying on this information.
How it works
If you have a $800,000 mortgage and there is $50,000 in your everyday transaction account you will pay interest on $750,000. Meaning the more in your everyday transaction account the more you save! And with the option to open up to 10 offset accounts, you can further amplify your savings by strategically distributing your funds.
Assumptions
Loan: $800,000
Variable rate: 6.50% p.a.
Offset balance: $50,000
Interest calculated daily, charged monthly (typical)
Interest is calculated on
Home loan balance – Offset balance = Net balance for interest
Loan balance: $800,000
Offset balance: $50,000
Net interest balance: $750,000
Approx interest saving
Annual interest reduction ≈ Offset × Rate
$50,000 × 6.50%
= $3,250/year
(about $270/month)
Actual savings vary with rate changes, repayments, and daily balance movement.
Doubling the loan size doesn’t double offset savings; offset savings scale with the offset balance and rate, not the loan principal (until the offset exceeds the loan balance).
Why Mortgage House’s Offset Account
Multiple offsets, one loan strategy
Open up to 10 offset accounts to separate savings goals—holiday, renovations, bills buffer—while each balance still offsets interest on the linked loan.
Everyday spending that still works for you
Use it like a normal transaction account. When wages land in the offset, the benefit starts straight away.
Designed for disciplined borrowers—and chaotic ones too
Even if your balance fluctuates, offsetting happens daily, so every dollar counts.
We offer the flexibility of up to 10 offset accounts.
You can segregate your funds according to your different financial goals, all while reducing the interest on your home loan. You can attach a different card to each of your offset accounts allowing for an organised approach to managing your money and maximises your savings potential.
Offset vs redraw
Offset
Your money stays in an account beside the loan; interest is reduced by your balance.
Vs
Redraw
Your money is extra repayments inside the loan; you may be able to withdraw it later, subject to rules.
General guidance only;
Product conditions apply.
Variable vs fixed rate
There is no cap on the offset interest-saving benefit (savings depend on balance and rate).
Vs
Offset interest saving is capped to $20,000. Amounts above the cap may not reduce interest during the fixed period.
Who is an offset account good for?
Make your money work harder — without locking it away
Enquire now and we’ll confirm eligibility, fees, and whether variable or fixed suits your strategy.
FAQs
What is an offset account?
An offset account is a transaction account linked to your home loan. The balance reduces the loan balance used to calculate interest, which may reduce the interest you pay.
Is an offset account the same as a normal bank account?
No. A true offset account is linked to a home loan so the balance reduces interest calculations. A normal bank account is not linked and does not reduce your mortgage interest unless it is an offset facility attached to the loan.
Is there a limit to how much interest I can save with an offset?
For variable rate home loans there is no offset interest-saving cap. For fixed rate home loans the offset benefit is capped to $20,000.
How many offset accounts can I have?
Mortgage House allows up to 10 offset accounts (subject to eligibility and product conditions).
