*iSelect is the trading name of iSelect Mortgages Pty Ltd (ABN 86 148 217 181). iSelect Mortgages Pty Ltd is a credit representative (Credit Representative 400540) of Auscred Services Pty Ltd (Australian Credit Licence 442372). iSelect provides a referral to Lendi Pty Ltd, a Credit Representative of Lendi Group Finance Pty Ltd (Australian Credit License 442372). iSelect Mortgages Pty Ltd receives a commission from the Licensee for each new customer account created and for each home loan submitted through this service.
We partnered with Lendi* to help you compare home loans from over 25 lenders and over 2,500 home loan products.
If you’re the sort of person who needs their cash flow to, well, flow, then you might like to consider getting a home loan with a redraw facility.
A redraw facility is the ability for you to access the money you’ve already put towards paying off a home loan. A typical example would be a situation where you may have submitted extra repayments ahead of your repayment schedule, but may need to access some extra cash flow. In other words, you can access only the sum of additional funds you paid above and beyond the regular payment schedule. It’s not offered across all loan types, but it can be a feature that many borrowers look for in a loan.
Here are some of the common reasons borrowers look for home loans with a redraw facility:
There are some key differences between redraw facilities and offset accounts. Some features may suit you better than others, depending on your needs.
If you’re easily tempted to spend money, then a redraw facility may give you the added incentive to keep saving and paying off your loan.
With redraw, the additional repayments you make can shorten the lifetime of your loan, and therefore, also the interest.
Whereas in an offset account, any money you deposit is deducted from your loan principal when your lender is calculating interest, which can also help reduce interest.
So, if you’ve been considering applying for a home loan with a fixed interest rate, then a redraw facility may not be an available feature depending on the lender.
If you’re on a fixed rate home loan, or even a home loan without a redraw facility, you may be considering other options that do offer a redraw facility. Maybe you’re even thinking about refinancing!
The good news is that we’ve partnered with Lendi to make that process simpler and easier for you.*
At iSelect we’ve partnered with Lendi to make it easier to find a great deal on your home loan. Click here to get started comparing from a range of lenders online, or give Lendi a call on 1300 186 260.
Last updated: 29/22/2021