Withdraw cash from your offset account with a debit card

How You Can Use a Debit Card to Access Your Offset Account

Rates and fees last updated on

Offset accounts can potentially save you thousands in interest over the life of your loan, and can be accessed with a debit card

If your loan has an offset account attached to it, it may be worth asking your banking institution if there is a debit card you can link to it. People with offset accounts linked to their savings accounts or debit cards could have the ability to withdraw cash.

An offset account consists of any mortgage overpayments, which are in excess of the scheduled repayments and charged interest. If you have an overpayment, it will be transferred to the offset account instead of coming off the mortgage. This will mean that the funds can be withdrawn any time by the borrower. If the borrower does not make a payment in a month, then the funds will be withdrawn from the overpayment account.

Interest is not usually charged on the balance and the mortgage interest will be higher than it is on the savings account. In addition, the interest is also going to be free of any tax obligations because technically the interest on a mortgage has no tax relief.

Overpayment can take place via direct payment into the mortgage account, which can then be withdrawn via redraw privileges. These privileges give the borrower the ability to automatically withdraw overpayments from the mortgage. Unlike the offset account, a borrower who exercises the rights to redraw may incur a fee, which may utterly reduce the advantage of a good interest rate when money is put into the mortgage.

It is worth keeping in mind that some banks and credit unions place a minimum withdrawal amount on an offset account. Make sure to check with your bank first.

About fixed rate home loans with 100% offset accounts

Did you know?

Overpayment is considered a type of savings. However, the funds can be instantly accessed at any time in an offset account.

Transaction account debit card access

One significant and noticeable difference with a transaction account debit card is that it often facilitates overdraft. This means the borrower could take an unapproved overdraft, which accompanies a fee and a high interest rate.

One single transaction on this account may cost the cardholder a high fee and triggered penalties because it will appear as if the user has reached the overdraft limit. Offset account holders don't have to experience this since there are no overdraft facilities. If the cardholder runs out of funds, the debit card transaction is turned down.

Offset accounts can be added to your variable rate mortgage loan. It connects to a normal savings account and utilizes your account balance to offset the balance on your mortgage loan. You will pay less interest on your home mortgage loan when you have more funds in your connected savings account.

How offset accounts perform

When you buy a home, the lender will usually charge interest on the entire loan balance. When you add the offset feature to your home loan, it changes this scenario. Rather than having to pay interest on the entire home loan balance, the lender subtracts the interest on the home loan balance from the funds you have in your connected savings account.

Mortgage offset accounts

Read on to find out how Mary and Steve accessed their overpayments to budget for a baby

Case study


Mary and Steve have a home loan balance of $340,000 and have built up a considerable amount of $7,500 in their connected offset savings account. They have been over paying their loan for a few years now and are expecting their first baby in a few months.

Whilst preparing for the arrival of the newborn by fitting out the spare room, they have had the option of spending on their credit card or using their offset account Visa Debit card. They opt to use the debit card and withdrawn from their offset account.

This way they can reduce the amount of interest paid, i.e. 20.24% p.a. on their credit card as opposed to 5.72% p.a. on their home loan balance. Once the room has been fitted, they have spent $3,500, leaving $4,000 left in the offset account.

This now means they are only paying interest on their new loan amount of $336,000.

Compare home loans with offset accounts

Rates last updated August 24th, 2017
Loan purpose
Offset account
Loan type
Your filter criteria do not match any product
Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment
loans.com.au Offset Variable - Up to 80% LVR (Owner Occupier P&I)
Take advantage of a 100% offset account along with no annual or application fees.
3.72% 3.74% $0 $0 p.a. 80% Go to site More info
Newcastle Permanent Building Society Premium Plus Package Home Loan - New Customer Offer ($150,000+ Owner Occupier, P&I)
Apply for a new owner occupier loan or refinance from another lender and receive this discounted rate.
3.74% 4.12% $0 $395 p.a. 80% Go to site More info
Reduce Home Loans Rate Buster 100% Offset Variable Home Loan - Up to $750k (LVR <=80%)
Borrow up to 80% LVR with no ongoing fees and a 100% offset account.
3.54% 3.54% $440 $0 p.a. 80% Enquire now More info
IMB Accelerator Home Loan  - LVR <=90% $300k+ (Owner Occupier)
A two year discounted rate which reverts to an ongoing life of loan discount afterwards.
3.84% 4.58% $445 $0 p.a. 90% Go to site More info
Tic:Toc Live in Loan Variable Rate
A competitive variable rate product with low fees offered by a 100% online lender.
3.68% 3.69% $0 $0 p.a. 80% Go to site More info
Bank Australia Basic Home Loan - Special LVR <70% (Owner Occupier)
A special variable rate home loan with no application or ongoing fees.
3.74% 3.75% $0 $0 p.a. 70% Go to site More info
Bank Australia Basic Home Loan - Variable (Owner Occupier)
Pay no ongoing fees on a competitive variable rate home loan.
3.86% 3.87% $0 $0 p.a. 80% Go to site More info
Beyond Bank Low Rate Special Home Loan - LVR <70%
A special low variable rate for owner occupiers with 100% offset account and no application or ongoing fees.
3.83% 3.83% $0 $0 p.a. 70% Go to site More info
NAB Choice Package Variable Rate - $750k+ P&I (Owner Occupier)
Enjoy discounted rates to a range of NAB products. 350K NAB Rewards Points offer available. Terms and conditions apply.
4.34% 4.74% $0 $395 p.a. 95% Go to site More info
IMB Essential Home Loan - LVR <=90% (Owner Occupier)
Get access to a redraw facility and offset account without the annual fee.
4.19% 4.19% $0 $0 p.a. 90% Go to site More info
loans.com.au Offset Variable - 80% to 90% LVR (Owner Occupier P&I)
A home loan with no ongoing fees. This loan is available for refinances and purchases.
4.04% 4.06% $0 $0 p.a. 90% Go to site More info
Auswide Bank Variable Home Loan Plus with Freedom Package - $150K+ LVR <= 90% (Special Offer, Owner Occupier)
A high maximum LVR home loan with redraw facility and additional payments.
3.69% 4.08% $0 $395 p.a. 90% Go to site More info
NAB Choice Package Variable Rate - $250k to $749,999 P&I (Owner Occupier)
Package your home loan to get discounts on your interest rate and other financial products.
4.39% 4.78% $0 $395 p.a. 95% Go to site More info
Commonwealth Bank Wealth Package Fixed Home Loan - 2 Year Fixed (Owner Occupier) P&I
A package home loan with fee free extra repayments available during the fixed term.
3.99% 4.99% $0 $395 p.a. 95% Enquire now More info
ANZ Breakfree Home Loan Package - $250,000 to $499,999 (LVR <=80% Owner Occupier, P&I)
A discounted variable loan package for under $500 000 home loans.
4.40% 4.80% $0 $395 p.a. 80% Enquire now More info
St.George Fixed Rate Advantage Package -  2 Year Fixed Rate (Owner Occupier, P&I)
A discounted package rate for owner occupiers with the ability to package a Qantas rewards earning Amplify credit card. $1,500 cashback available for refinancers. Conditions apply.
3.99% 4.98% $0 $395 p.a. 95% Enquire now More info
Virgin Reward Me Variable Home Loan - LVR <= 80% ($750k+ Owner Occupier, P&I)
Earn Velocity points on a competitive variable rate home loan with flexible features.
3.79% 3.92% $0 $10 monthly ($120 p.a.) 80% Enquire now More info

By utilising a debit card transaction account in conjunction with your offset account, you can get access to your funds when you need them. Basically you are paying interest on the total outstanding minus the amount you have in savings. The incentive is to save more.

Marc Terrano

A passionate publisher who loves to tell a story. Learning and teaching personal finance is his main lot at finder.com.au. Talk to him to find out more about home loans.

Was this content helpful to you? No  Yes

Related Posts

Bank Australia Basic Home Loan - Variable (Owner Occupier)

Pay no ongoing fees on a competitive variable rate home loan.

NAB Choice Package Home Loan - 2 Year Fixed (Owner Occupier P&I)

A fixed rate package with flexible repayment options. 350K NAB Rewards Points offer available. Terms and conditions apply.

IMB Budget Home Loan - LVR <=90% (Owner Occupier)

Get a competitive rate without features you may not use.

HSBC Home Value Loan - Resident Owner Occupier only

Enjoy a low variable rate with no ongoing fees and borrow up to 90% of the value of the property.

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, read the PDS or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms and Conditions and Privacy Policy.
Ask a question