Offset vs Extra Repayment Calculator
Compare the interest effect of keeping cash in offset with applying the same cash as an extra repayment, including offset fees or a rate premium.
Your assumptions
Comparison
Enter your figures and calculate. Results are estimates, not a quote or credit decision.
Why can the interest saving look almost identical?
With a $600,000 mortgage and $50,000 available, a full offset initially leaves interest charged on $550,000. Paying the same $50,000 into principal also leaves $550,000 owing. At an illustrative 6%, the initial annualised interest reduction is $3,000 in either case, before fees.
The calculator holds the cash and original scheduled repayment constant. Offset costs can make its net result worse even when the gross interest effect matches. An extra repayment may be accessible only under the redraw terms; it is not a separate deposit account.
When does paying for an offset make sense?
A $400 annual package fee requires about $6,667 in average offset cash to recover that fee alone at 6%. A rate premium raises the hurdle. This tool estimates the premium as a simple charge on the entered original mortgage balance; it does not price an entire alternative mortgage product.
For refinancing, compare the whole loan using the refinance calculator. For access at settlement, read what happens to redraw when refinancing.
How to use the result
This is an interest comparison, not tax advice. Offset and redraw can have different legal, operational and tax consequences.
The rate-premium field lets you model a more expensive offset package where relevant.
Read the calculation methodology and assumptions.
If the numbers justify a closer look, send the transaction details for an initial broker review.
Review my home loan optionsGeneral information only. Calculator results are estimates and do not account for every fee, tax outcome, contract feature or lender rule. Finance approval and pricing are subject to lender assessment.