Offset accounts proving popular down under
Article by Mozo
House hunters are increasingly opting for mortgages that come with an offset account, as this can help to slash the interest rates attached to home loan repayments.
Bosses at the National Australia Bank (NAB) and Suncorp have both noticed a sudden spike in the number of people who are choosing this type of package, News Limited reports.
Any money that is kept in the offset account is considered when a lender calculates the interest rates on a person's mortgage.
For example, somebody who has a $200,000 home loan and $5,000 in their linked account will pay interest on $195,000.
This is a great way to save money in the long run and NAB spokesman George Svigos told the news provider: "Offset accounts have more than doubled and the balances have almost tripled since 2010."
The recent ban on exit fees has enabled more Aussies to switch their loan providers without racking up huge charges and offset account packages will no doubt prove increasingly popular in the future.
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