An Offset Account is a deposit account linked to the loan. The benefit being that any surplus funds that you might have, for example rental income or your pay, can be deposited into the account, offsetting the daily interest charged on the total loan amount. An Offset Account is generally not a loan that an investor would use on an investment property, but rather on their family home in conjunction with an investment.
As an example - if the loan amount outstanding is $100,000 and there is $5,000 in the offset account, the interest that is charged on the loan will be calculated on $95,000. As a result, the home loan is paid out at a faster rate. This is because the standard monthly repayment has been calculated on the full amount outstanding.
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There are basically two options most homeowners go with when refinancing mortgage loans, you can either refinance or go with a cash out (line of credit) refinance home loan. When you go with the refinance mortgage route you are basically refinancing your existing mortgage or consolidating debts hopefully at a lower interest rate to save money.

Consolidating debts, particularly ones with high interest charges like credit cards and even personal loans or car loans, into your home loan is something many lenders will consider and can provide savings through the reduction of high interest rate charges down to the lower interest rate of the home loan.

Refinancing for a line of credit while may seem great, nothing is for free, the facility is normally only available on Standard Variable loans, which are generally more expensive than basic variables. Before you make any decisions, understand the conditions attached to the redraw facility as it may include a minimum amount and a fee when you use it.

Also see:
mortgage refinance
mortgage types
lender types