{"id":829957,"date":"2026-07-28T22:33:11","date_gmt":"2026-07-28T22:33:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/829957\/"},"modified":"2026-07-28T22:33:11","modified_gmt":"2026-07-28T22:33:11","slug":"mortgage-offset-account-errors-mean-some-australians-are-owed-thousands-of-dollars-are-you-among-them-banking","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/829957\/","title":{"rendered":"Mortgage offset account errors mean some Australians are owed thousands of dollars. Are you among them? | Banking"},"content":{"rendered":"

The corporate regulator has detailed how banks have had to pay tens of millions of dollars in compensation to customers for mortgage offset failures.<\/p>\n

In a new report, the Australian Securities and Investment Commission showed lenders repaid $55m to customers over two years<\/a> after they unknowingly paid too much interest on their mortgages \u2013 and warned the number would climb higher.<\/p>\n

Here\u2019s how to check whether you have fallen foul of what could be an expensive administrative error.<\/p>\n

What is a mortgage offset, anyway?<\/p>\n

Mortgage offsets are savings accounts that are linked to your mortgage.<\/p>\n

As the name suggests, whatever money you have in these accounts is then subtracted from the total value of your outstanding home loan.<\/p>\n

A lower outstanding balance means you pay less interest \u2013 and pay your loan off faster.<\/p>\n

They are hugely popular \u2013 more than half of the nearly 3.3m households with a mortgage have an offset account, according to Reserve Bank data.<\/p>\n

Suzanne Haddan, the managing director at BFG Financial Services, says offset accounts are a great way to budget and pay off your loan sooner.<\/p>\n

\u201cI love them,\u201d Haddan says.<\/p>\n

But only if they are working as advertised.<\/p>\n

Asic\u2019s review of more than 200,000 home loans from eight banks found weaknesses in how all the lenders set up, monitored and managed offset accounts.<\/p>\n

That resulted in some customers missing out on promised savings. In one case, it meant a borrower was overcharged more than $3,500 in interest in a single month.<\/p>\n

Haddan said she had not come across an instance where a bank had not properly linked offset accounts requested by her clients, saying it would be \u201cdisgraceful\u201d.<\/p>\n

Check your mortgage accounts online<\/p>\n

The first port of call could be checking your mortgage and account details online \u2013 either through internet banking, or your lender\u2019s app.<\/p>\n

Sign up for the Breaking News Australia email<\/a><\/p>\n

Your mortgage will typically have an account summary than you can click on, where you can find basic details like your interest rate and outstanding balance. Haddan says most bank sites and apps she has looked at will also have a \u201cmortgage offset\u201d heading. That will tell you if you are eligible for an offset and what your offset account number is.<\/p>\n

Sally Tindall, the director of data insights at Canstar, says there may be a \u201cmanage my loan\u201d link which should reveal any linked offset accounts.<\/p>\n

Different banks will have different layouts. The information will be there. But if it\u2019s not, or you can\u2019t find it, it\u2019s time to be more direct.<\/p>\n

Call your lender and ask<\/p>\n

Tindall says this may well be the easiest solution. Of course, it can take some time to actually get through to a human on the phone.<\/p>\n

And when you do get through, you may find the person at the other end of the line is less well-informed than they could be.<\/p>\n

Even then, you may not be convinced with the answer you get.<\/p>\n

As Tindall says, \u201cit was alarming to see how banks didn\u2019t even realise they had a problem until Asic came knocking\u201d.<\/p>\n

If you\u2019re still worried, it may be time to break out the calculator.<\/p>\n

Do the (rough) maths<\/p>\n

Your online banking or app has all the information you need to do a quick sense check on whether your offset account is working as promised.<\/p>\n

Haddan says it involves two steps.<\/p>\n

First, work out roughly how much interest you should be paying per month (or fortnight) based on the outstanding balance of your home loan, not including any offset accounts.<\/p>\n

You\u2019ll find the loan balance at the start of the month in the banking app or on the site. You multiple that by your interest rate and then divide by 12, assuming monthly repayments.<\/p>\n

Haddan emphasises that the goal is not to do a perfect calculation \u2013 \u201cyou\u2019re only looking for a guide\u201d.<\/p>\n

(And remember: we are only looking at the interest component. So your total mortgage repayment might be $3,900, but your interest payment would be less, for example, $1,500.)<\/p>\n

If your estimated interest payment on your entire home loan before offsets is meaningfully higher than your actual monthly interest payments as shown in your account, then you can be pretty confident that your offset accounts are working as promised.<\/p>\n

Still not satisfied?<\/p>\n

If you\u2019ve done the maths, checked your accounts, made the calls to your lender, asked for reviews, and you still reckon something is not right, then it could be time to contact the Afca, the Australian Financial Complaints Council.<\/p>\n

Tindall says Afca \u201cis a fantastic resource that\u2019s free of charge for consumers\u201d.<\/p>\n

Afca doesn\u2019t take sides, but will help mediate with your financial institution to help you resolve your complaint.<\/p>\n","protected":false},"excerpt":{"rendered":"The corporate regulator has detailed how banks have had to pay tens of millions of dollars in compensation…\n","protected":false},"author":2,"featured_media":829958,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,63,44],"class_list":["post-829957","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-australia","tag-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/829957","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=829957"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/829957\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/829958"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=829957"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=829957"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=829957"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}