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What is an offset account?

An offset account is a type of savings account or transaction account that is linked to your mortgage.

The “offset” amount diminishes the balance of your mortgage account, meaning that rental is only charged on the difference between the two. For example, if you had a mortgage balance of $500 000 and an offset account balance of $100 000, you would only need to pay rental on the difference, i.e. $400 000. In effect, you end up paying less rental and a higher portion of your repayment amount goes towards paying off your principal. 

You may utilise our Offset Calculator to determine the potential financial savings from having funds in your offset account, in relation to the overall Ijara payments made towards your loan.