Before starting with the Home Loan Offset Calculator, we need to understand what an Offset account is. An offset account serves as a general transaction account linked to the loan account. Whatever amount you save in an offset account will deduct from your existing loan balance. The higher the amount you keep in an offset account, the lesser the home loan interest you need to pay. In this way, you save on interest paid on your home loan.
Wondering how home loan offset calculators work? Here you go.
How to use Home Loan Offset Calculator
Using an offset account helps you calculate how many years and interest you can save on your home loan. And pay your home loan sooner.
To use our offset calculator, you need to follow the following steps.
- Fill in the following details
- Loan Amount
- Interest Rate
- Loan Term
- Repayment Frequency
- Enter your Offset Account Details
- Get your results as
- What will be your Monthly Repayment
- How much interest payment you will save
- How much time you will save
- The rest of the time, you will pay interest
After using this calculator, you will get an idea of whether an offset account is a suitable choice for your financial circumstances or not. You can even compare results in other offset calculators to be 100% sure.
Why you should use Home Loan Offset Calculator
Sometimes, it is daunting to get an idea about an offset account working system. And how much will we save after using this account for our home loan? The offset Calculator helps you to see the advantages swiftly. You can quickly check how much time you can pay off your mortgage loan. And how much interest you will save at the end.
The question you may ask about Home Loan Offset Calculator
You can call or email to clear all your offset account and calculator questions.
How much accuracy can we expect from the offset calculators result?
Offset calculators assist you with approximate results as your potential offset savings. It does not take into account.
- Change in your home loan interest rates
- Adding or withdrawing money from the offset account
- Any fees or cost of acquiring a loan or purchasing property
How to get an offset account?
Your home loan should have premium loan features to adapt to the benefits of an offset account. In this case, you need to refinance your home loan to switch your loan lender. Then compare your options and get a suitable loan and an offset account. When you get your loan settled with the new lender, transfer funds from your savings account to an offset account to get the advantages.
What is the difference between redraw facility and offset accounts?
The redraw facility is slightly different from the offset account. The offset and redraw accounts help you save the interest you pay on loan. However, there is a slight difference between the two. Where you have the offset facility, the interest is calculated on the daily net balance of the loan account and the offset account.
On the other hand, in the case of the redraw feature, you will only save interest after you transfer your savings to the loan account. The interest is calculated on the outstanding balance of the loan account. The due balance is calculated by deducting the additional amount you have paid on the loan account (Redraw) from the Loan Limit (amortized loan amount).
In simpler words, an offset account is easier to manage than a redraw facility. Even though in both of the cases, you can assess your funds whenever you want in both cases. But considering funds from a redraw facility is less flexible than an offset account facility. Because some lenders place a daily limit on the amount, you can redraw from the loan account or charge a fee for this action.
Apt Mortgages offers seamless calculators.
At Apt Mortgages, we have a suite of easy-to-use mortgage calculators that can help you plan your finances and help you model your mortgage scenario. You need to enter the relevant details to estimate your loan details beforehand.