| In the case of an offset mortgage, your main bank | | | | account of $25,000, you will pay interest only on |
| current account and/or savings accounts are linked to | | | | $75,000. As a consequence, when your current |
| your mortgage. Each month, the amount you owe on | | | | account and savings balances go up, you pay less on |
| your mortgage is reduced by the amount in these | | | | your mortgage. As they go down, you pay more.This |
| accounts before working out the interest due on the | | | | type of mortgage can also be tax-efficient if you pay |
| loan. For instance, if you have an interest-only | | | | tax on your savings. |
| mortgage of $100,000 and have savings in your offset | | | | |