VIDEO – A loan re-draw and an offset – the same but different

VIDEO – A loan re-draw and an offset – the same but different

A loan re-draw is when you have pre-paid money into your loan and you have the ability to re-draw that amount.  It is like repayments in advance of what you need.  An offset account, on the other hand, is a second account that attaches itself to your loan.  Whatever money is sitting in that, is cash and it off-sets against your loan.  They might sound the same but Andrew Mirams explains the fundamental differences.

    Posted at 19:45h, 19 November Reply

    Thank you for the Pod Cast.
    When I made a re draw from my home loan I had payed $8,500 extra in payments so my re draw capability was $8,500.
    How ever when I made the re draw a month later on my statement they had increased the normal weekly loan re payment from something like $420.00 per week to $455.00 which was a shock at the time.
    So I rang them and asked why, as all I did was take back the extra payments on top of the normal payments as I thought the Re Draw was designed to do. They explained that because I made a Re Draw for some reason they had to increase the normal re payments I had been making for years to compensate for the loss of the $8,500 I had taken out.
    Can you please check this out to confirm this is correct. As this is a very important point.
    Thank you,

    • Kevin Turner
      Posted at 07:29h, 27 July Reply

      Hi Mike. I will get that answered for you. Kevin

Leave a Reply