Kim and Thomas have an existing home loan. Their property is worth $435,000 and after ten years of paying their mortgage payments each month, Kim and Thomas now owe just $185,000 on their loan. This leaves them with equity of $250,000 in their home.

By refinancing their loan to us, Kim and Thomas were able to find a more suitable mortgage with a lower interest rate, they also chose to untie an extra $60,000 worth of equity, money they can use to invest elsewhere.

However, as Kim and Thomas have no immediate use for the additional $60,000, they have placed the funds into a 100% Offset Account supplied with the loan, meaning they don’t have to pay any interest on the additional amount borrowed. Their financial position has not changed. They still have a home loan of $185,000 to pay off, however they now have a reduced interest rate and $60,000 worth of accessible funds they didn’t have before.