Anz Home Loan Offset Account Calculator

An ANZ home loan offset account is a financial tool that can help reduce your mortgage interest payments. By linking a savings account to your home loan, you can earn interest on your savings while simultaneously reducing the amount of interest you pay on your mortgage.

What is an offset account?

An offset account is a savings account that's linked to your home loan. The money in the account is used to offset (reduce) the amount of your loan balance, which can lower your interest payments.

For example, if you have a $300,000 home loan and $50,000 in your offset account, your loan balance for interest calculation purposes would be $250,000 instead of $300,000.

Offset accounts are different from redraw facilities. With a redraw facility, you can access your savings while still paying interest on the full loan amount. Offset accounts reduce the interest-calculable amount.

How offset accounts work

When you set up an offset account with ANZ, the bank will deduct the offset amount from your loan balance for interest calculation purposes. Here's how it works:

You open a savings account with ANZ and link it to your home loan
You deposit money into the offset account
ANZ deducts the offset amount from your loan balance
Your interest is calculated on the reduced loan balance
You earn interest on the money in your offset account

Interest Calculation Formula:

Interest = (Loan Balance - Offset Amount) × Interest Rate × Time Period

The key benefits of offset accounts include:

Lower interest payments on your home loan
Interest earned on your savings
Potential tax benefits (depending on your situation)
No additional fees for most offset accounts

Worked example

Let's look at a practical example to see how an offset account can save you money.

Scenario	Loan Balance	Interest Rate	Offset Amount	Interest Paid
Without offset	$300,000	4.5%	$0	$13,500
With $50,000 offset	$300,000	4.5%	$50,000	$9,000

In this example, using a $50,000 offset account reduces your annual interest payments by $4,500. Over 30 years, this could save you over $135,000 in interest payments.

Note: Actual savings will depend on your specific loan terms, interest rate, and how much you can deposit into your offset account.

Frequently Asked Questions

How much can I offset against my home loan?

The amount you can offset depends on your loan terms and the amount you have in your offset account. Typically, you can offset up to the full amount of your loan balance.

Can I withdraw money from my offset account?

Yes, you can withdraw money from your offset account, but this will reduce the amount available to offset your loan balance. Withdrawals may also affect your interest rate.

Are there any fees for an offset account?

Most offset accounts have no fees, but some may charge a small fee for withdrawals or other transactions. Check with ANZ for specific fee details.

Can I have multiple offset accounts?

ANZ typically allows only one offset account per home loan. Check with your bank for their specific policies.