HBS partial offset limit

[murph14]

Just wondering if any brokers here know what the partial offset % limit is on Heritage Building Society's fixed rate loans?

Does it work the same as a 100% offset on a variable loan?

I've read about 'making sure you have a true 100% offset acc set up' whatever that means?

Thanks.

 

[Peter_Tersteeg]

PARTIAL OFFSET AVAILABLE: Interest rate applicable to the daily balance in Loan Offset Account is set off against the interest rate applicable to the part of the loan equalling the Loan Offset Account daily balance. e.g. Linked Loan Offset with daily balance of $10,000 earning 2% p.a. interest is calculated on $90,000 at 7.5% p.a. and $10,000 at 5.5% p.a. (i.e. 7.5%-2%).

From this description it's not really an offset account. They set up a savings account and credit the interest earned against the interest charged on the loan. It's certainly better than most fixed rates with offsets, but it's not the deal you'd expect.

 

[Rolf Latham]

HBS allows "unlimited" repay and redraw from the fixeds

Adelaide Bank does have a 100 % proper offset on their fixed

ta
rolf

 

[murph14]

Thanks for the clarification. I suppose if you don't intend to recycle the funds in the offset acc it's better to pay down the principle and refinance, especially if there's a better rate and/or stability to gain.

Thanks again