I was thinking on refinancing my existing PPOR to get access to equity (take up to 80%) or a future property purpose. I currently have an offset account for our current loan.
As an example, lets say I refinance and get access to an additional $100k. It may take a while to find this property (perhaps over 12 months) and use these funds to cover fees deposit etc. Obviously I have to start payments on this additional amount (interest only at least). So it will currently cost $5k per annum in interest alone for this money. If I put it in the offset account, it will reduce interest charged on the other loan by an equivalent amount, so balancing each other out. After a period of time, am I able to access the interest saved by using the offset? e.g after 12 months of having $100k in offset, can I redraw $5k from my other loan that is tied to the offset, or will it simply reduce the life of the loan? Am I making sense here?
As an example, lets say I refinance and get access to an additional $100k. It may take a while to find this property (perhaps over 12 months) and use these funds to cover fees deposit etc. Obviously I have to start payments on this additional amount (interest only at least). So it will currently cost $5k per annum in interest alone for this money. If I put it in the offset account, it will reduce interest charged on the other loan by an equivalent amount, so balancing each other out. After a period of time, am I able to access the interest saved by using the offset? e.g after 12 months of having $100k in offset, can I redraw $5k from my other loan that is tied to the offset, or will it simply reduce the life of the loan? Am I making sense here?