Mortgage Offset

This calculator will show how a linked account with a credit balance can help reduce the interest and time taken to pay off your loan. Interest is charged only on the principal minus the offset amount helping to reduce the interest on each payment. If your account balance is equal to your home loan amount no interest will be charged on your home loan. The greater your offset amount, the greater your interest and term reduction will be.

Assumptions:

• Offset amount remains the same for the term of the loan.
• Interest rates remain the same for the term of the loan.
• One year is 52 weeks exactly, a month is 52/12 weeks and a fortnight is 26 weeks.
• Interest is calculated by compounding on the same frequency as the repayment stated, i.e. weekly, fortnightly or monthly.
• Repayments are made at the start of each period.
• Rounding is made at the end of the calculations and not at each payment period
• It does not take into account up-front fees and monthly/annual account fees.
• You can email your results to yourself and if you request, a copy of your results and contact information is sent to the web site owner.
• You can print your results for future reference.
• You should consult a finance professional before you make decisions based on this calculator.