Mortgage Offset Calculator
See how much interest an offset account could save on your home loan, and how much sooner you could be debt-free.
How it works
The calculator first works out your standard repayment using the same amortised-loan formula as the Mortgage Repayment Calculator. It then simulates the loan period by period, charging interest only on the balance above your offset amount, and compares the resulting payoff time and total interest against the same loan with no offset at all.
Interest per period = (Loan Balance − Offset Balance) × Periodic Rate
Worked example
A $500,000 loan at 6% p.a. over 30 years, with a $50,000 offset balance:
- Interest-bearing balance
- $500,000 − $50,000 = $450,000
- Monthly repayment (unchanged)
- ≈ $2,998
- Interest saved over the loan
- A meaningful reduction — try it with your own numbers
Frequently asked questions
Interest on your loan is calculated on your loan balance minus your offset balance, not the full loan balance. Your required repayment doesn't change, so more of each repayment goes toward the principal instead of interest — which pays the loan off sooner.