I'm sure many are envious of your position right now, I am too.
I knew about this product 2.5 years ago but decided against it mainly because loans.com.au is not an approved deposit institution (eg. banks, credit unions, etc.) so deposits of up to $250K in your loans.com.au redraw offset account is not guaranteed by the government. Therefore I'm not sure what will happen if the lender goes bust (they were quite new back then). I'm not sure if the deposit in the redraw offset account will be lost and whether the borrower will still be legally bound to repay the loan balance (ie. the full loan balance without deducting the deposit balance in the redraw offset account)? I have read many articles that explain why loans.com.au refers to the account as a redraw offset account instead of an offset account. It's because it's not an ADI.Nevertheless I don't think we will see an Australian financial institution being as bad as what we saw happened to Laiki Bank in Cyprus a few months back, but nobody will ever know.
