Compare offset home loan

An offset account is a savings account that can help you save money on your home loan. Mozo's guides and comparison tools can help you compare home loan deals with offset accounts. Get started today!

Fact Checked
Piggy bank offset account home loan

Comparing home loans made easy

Home loan comparisons on Mozo - last updated 25 May 2024

Search promoted home loans below or do a full Mozo database search. Important disclosures

Interest rates change regularly - stay informed.

Compare more home loan options

Home loans come in many shapes and sizes, start comparing here based on your needs. 

Search the Mozo Database

Browse all 463 home loans in Mozo's comparison database.

Knowledge Hub

What is an offset account?

An offset account is a transaction or savings account linked to your home loan that saves you interest on your home loan repayments.

This excellent feature means your savings stash is constantly lowering the amount of interest you pay on your mortgage, even while you’re using those funds for your day-to-day spending and bills.

This type of interest-saving feature is quite common with packaged and variable home loans. So if you're looking to save some cash (literally and figuratively), it's certainly one to compare!

Person putting coins into an offset account
Person holding a piggy bank offset account

How an offset account works

Basically, instead of being charged interest on your full mortgage amount, you’re only charged interest on how much you’ve borrowed, minus the balance of your home loan offset account.

Here’s an example: Say you had a $300,000 mortgage and $50,000 parked in the attached offset account. Instead of paying interest on the full $300,000, you would only have to pay it on $250,000.

Since interest is charged as a percentage of your remaining principal, this 'offset' amount can mean huge savings over the life of a 25 or 30 year mortgage.

How much will I save with an offset account?

How much you save with an offset account will depend on how much money you have in it, the size of your home loan, your interest rate, and what type of offset account it is.

For example, you'll save more interest if:

  • You have more money in the offset account.
  • The offset is a 100% offset account.
  • Your loan size is small.
  • Your interest rate is low.

You can crunch the numbers on your own home loan or talk to your lender to find out how much you could save long-term. But in the era of Reserve Bank rate hikes, offset accounts can prove to be a compelling option. 

Woman thinking about how much an offset account will save her
Man points to partial offset account

What does a “partial offset account” mean?

Not all offset accounts are created equal, and it pays to double check what you’re signing up for.

  • A full offset account means that 100% of the funds in your account will be offset against what you owe on your home loan. 
  • A partial offset account means only a part of the balance in your account offsets against your home loan amount. 

Partial offset accounts are more common fixed rate home loans, since fixed mortgages tend to have more limited features. 

Compare offset account home loans interest rates

Having an offset account attached to your loan can help reduce the amount of interest you pay and has the potential for big savings over the life on your home loan.

However, there's no true substitute for a truly competitive home loan interest rate.

Woman comparing offset account home loan rates

Offset home loan FAQs

Does it cost more to have an offset account on my mortgage?

It might. Generally, home loans with more features tend to have slightly higher interest rates and fees than a basic option. 

That means it's important to weigh up these costs against the potential savings from having the offset account. 

What’s the difference between an offset account and making extra repayments?

Similar to an offset account, extra repayments lower your principal loan amount, cutting down on interest.

The benefit to making extra repayments is that you’re actually paying off your principal loan amount and gaining home equity, whereas with an offset account, you’re only lowering the portion of the loan amount you pay interest on.

It’s also a little more common to find a mortgage offering extra repayments than an offset account.

The downside is that extra repayments are less flexible. You may be able to redraw them if you have a redraw facility, but otherwise, they're not at call.

How do I find the right offset home loan for me?

An offset account is just one part of the home loan. You'll also need to consider the loan size you need, as well as other features, interest rates, and repayment types.

You can use our home loan comparison tool to compare the rates and features on a huge number of mortgage offers from a range of lenders, including big banks, mutuals, online banks and non-bank lenders.

Picture of jp-pelosi

JP Pelosi

RG146
Managing editor

Jean-Paul (JP) Pelosi is an experienced journalist and editor who has contributed to many of Australia's leading media outlets including The Guardian, News.com.au, Domain.com.au, Investment Magazine and ANZ's Bluenotes. He has also edited news and communications for large financial services companies such as CommBank, Suncorp, Allianz and Amex. He loves a well told story and applying his editorial experience to content that readers both care about and enjoy. JP heads up our writing team.

Picture of evlin-dubose

Evlin DuBose

RG146
Senior Money Writer

Evlin is RG146 certified for general advice (Tier 2) and has become a leading voice in finance news since joining Mozo two years ago. She is regularly featured in Google's Top Stories alongside major publications like News.com.au and Yahoo Finance, and seasoned journalists. Despite being in the industry for just two years, she is Mozo's go-to writer for all things RBA and her research has been referenced by the Victorian Government. With a Bachelor of Communications degree from UTS, where she won the Dean's Merit Award and acted as the Director of Student Publications.

Brands we compare

We compare home loans from the following well-known providers and many more... See more home loan providers

Home loan customer reviews

ANZ Plus Home Loan Variable
Overall 2/10
ANZ bank just aren’t helpful

No bank wants to help you when you have $165,000 mortgage we tried to borrow $50,000 and we got treated like we’re idiots

Read full review

No bank wants to help you when you have $165,000 mortgage we tried to borrow $50,000 and we got treated like we’re idiots

Price
3/10
Features
3/10
Customer service
2/10
Convenience
1/10
Trust
1/10
Less
Julie, Victoria, reviewed 10 days ago
ANZ Home Loan
Overall 6/10
Disappointed in their app & rewards site

ANZ Bank's online and mobile banking platforms are unreliable and difficult to navigate, often experiencing frequent outages and glitches. This makes it challenging for me to access their accounts and perform basic banking tasks. I still can't access my credit card rewards site.

Read full review

ANZ Bank's online and mobile banking platforms are unreliable and difficult to navigate, often experiencing frequent outages and glitches. This makes it challenging for me to access their accounts and perform basic banking tasks. I still can't access my credit card rewards site.

Price
6/10
Features
6/10
Customer service
3/10
Convenience
4/10
Trust
8/10
Less
Cherie, New South Wales, reviewed 10 days ago
Westpac Rocket Investment Loan
Overall 2/10
You’re just another number in their system

Easy to sign up but they have no intention on initiative to tell you when interest rates go up.

Read full review

Easy to sign up but they have no intention on initiative to tell you when interest rates go up.

Price
4/10
Features
4/10
Customer service
4/10
Convenience
7/10
Trust
1/10
Less
Julia, Queensland, reviewed 10 days ago

More home loan reviews