Hi all, Having worked in the accounting/finance industry previously i recognise the eggshells you walk with seemingly 'harmless' redrawing /taking out money out of loan accounts without a second thought - only to be told you've just complicated the deductibility of your loan i.e. having to apportion your interest deductions forever and ever for that 0.05% private use you drew back out. That said - I'd love to hear those who have experience and practical experience with the following scenario: My bank handled the FHOG application, and has plonked the $10,000 straight into my home loan account.... now they've advised me i have a few thousand dollars as 'surplus funds' after taking into account future builder progress payments as well as post-construction third party invoices. They claim that while this money shows up in my banking as against my loan account (so thereby reducing the borrowings by $10,000 and increasing my remaining available credit limit by $10,000 as a result), they have advised that behind the scenes on the bank side it is kept quarantined so that any surplus funds can be worked out and returned. It's easy to have it paid out to me, but my worry is it will be considered a repayment of $10,000, and a redraw of money for a non-property purpose (even if plonking it straight back into the offset account). It would be a pain if ever audited if they deem 99.8% of the loan is for property purposes, and the other 0.2% should have been quarantined. I plan to live in it before i eventually rent it out, hence why interest deductiblity/offset in the future was a big part of my plans. Having as much liquid funds via the offset was therefore my intention than repaying out of the loan. I don't know if this is normal bank protocol, wish they'd asked first. I was conservative in adding in quotes for painting and other items which i may even DIY, so in that sense my surplus funds by end of build might even end up being higher. any advice please? holding off on releasing the funds until a clearer picture is available.