- Shiny_Suit_ManParticipant@shiny_suit_manJoin Date: 2012Post Count: 54
Just after a small amount of clarification and some thoughts on my current situation. Finally just completed settlement after refinancing my IP to a different lender with an interest only loan with redraw and an offset account. Now my query is, if i add money into the offset account, if i was to look at my account listing on the online banking should the loan appear as if its decreasing? Or should the loan stay the same? Basically when i refinanced i had to open an account with that bank, at which point i set up online banking and transferred money to cover any costs involved. Now i have added more money after the loan has all been added and i can see the loan on my online banking, right next to my account. But when i add money to it the loan value doesn’t change. Which on one hand makes perfect sense because i’m not actually paying anything off the loan. But on the other hand, the idea of having an offset account is to have the illusion that you are actually paying down the loan even though you really aren’t.
Thanks in advance.
– ShinyTerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
Yes, it shouldn't change with most banks. The offset works by reducing the interest charged so you should see the monthly interest amount fluctuate as your offset balance goes up and down.Shiny_Suit_ManParticipant@shiny_suit_manJoin Date: 2012Post Count: 54
Thanks Terry! I thought this might be the case but i knew someone would have the answer.