What’s an offset account? (Q&A)

An offset account works similarly to a savings account. It has a debit card to pay for things or withdraw cash, as well as all the other things you’d expect from a savings account, such as online banking and statements.

But there is one big difference - because it’s linked to your home loan, the balance of money in your offset account is taken away from your home loan balance when your interest is calculated. 

This means if you hold money in your offset account over a period of time, you can reduce the amount of interest charged on your home loan. And because you're paying less interest, you'll pay off your loan faster, too.

To find out exactly how Qantas Money Home Loans works out the offset calculation, please visit our website, or you can speak to one of our home loan experts to help understand your options and explain how offset accounts can help you.

Your repayments

It’s important to keep in mind that just because you’re paying less interest, it doesn’t mean your loan repayments will go down. You’ll have the same home loan repayment, but more of that amount will be going towards paying down the principal loan balance, and less going towards interest. Which means you’ll repay the principal sooner.

Other benefits

Flexibility

An offset account can not only help you to build good financial/saving habits and pay off your loan faster (and save on interest); it also offers you the flexibility of having funds on hand whenever you need - say, if you want to go on holiday, renovate, buy a car, etc.

Cash flow management

Some lenders only provide one offset account. However, Qantas Money Home Loans provides you with the option to have up to six offset accounts* when you take out an Offset Home Loan. Being able to access multiple offset accounts provides you with a powerful cash flow management tool, giving you the flexibility to ‘bucket’ your finances. Different accounts can be used for different purposes - one for bills, one for holidays, one for home renovations, etc. So you can easily see and keep track of your savings goals. 

Set and forget for ultimate convenience

As an offset account is separate from your home loan account, you can ask your employer to make direct payments into your offset account. If you can’t get your employer to set up a payment, you can set it up yourself, then set a direct debit or auto-payment to go out shortly after you’re paid.

Make your money work for you

Offset accounts can help you save money by paying less interest on your home loan, but they can also help you save on tax. How? If you've got money in an interest-earning savings account, it's likely that you'll also be taxed at the end of the year for any interest earned.

Your money is protected

An offset account is just like any other savings deposit account, and it’s guaranteed under the Australian Government’s Financial Claims Scheme (FCS) for up to $250,000.

Offset account fees

There is usually a cost involved in having an offset account. It may be a monthly fee, or it could be built into the interest rate. If you don't have a certain balance in your offset account, it may not be worth paying to have the feature. This is why it’s important to make sure you know what it’s going to cost you before you make your decision. You can find the offset account fees for Qantas Money Home Loans here.

Find out how Qantas Money Home Loans offset accounts* work here. Qantas Money Home Loans and offset accounts are subject to the Points Eligibility Policy.

You have to be a Qantas Frequent Flyer member to apply for a Qantas Money Home Loan. This website contains general advice only. This information has been prepared without considering your objectives, financial situation or needs. You should consider your circumstances before acting on this information. 

* An offset facility can only be linked to one home loan at any one time. Linked offset facilities must be in the same customer name/number. This is general advice only. Consider the PDS and TMD and your personal circumstances before you take out this product.