Your offset account

Discussion in 'Loans & Mortgage Brokers' started by virgo, 25th Mar, 2020.

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  1. virgo

    virgo Well-Known Member

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    Hi

    To all the old (new?) timers out there....

    Does anyone remember if during the 2008 GFC, any of the Big 4 banks withdrew their Offset facility?

    For eg. Loan 1million;
    Funds in Offset 400K

    Bank XX took the 400K and reduce the loan to net 600K ; thereby getting rid of your accessible funds of 400K?:eek:

    Thanks!
     
    virgo, 25th Mar, 2020
    #1
  2. The Y-man

    The Y-man Moderator Staff Member

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    The Y-man, 25th Mar, 2020
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  3. virgo

    virgo Well-Known Member

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    virgo, 25th Mar, 2020
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  4. The Y-man

    The Y-man Moderator Staff Member

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    The Y-man, 25th Mar, 2020
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  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Never heard of that happening.
     
    Terry_w, 25th Mar, 2020
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  6. Gockie

    Gockie Life is good ☺️ Premium Member

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    I didn't either. I just remember the rapid decrease in interest rates :)
     
    Gockie, 25th Mar, 2020
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  7. Nodrog

    Nodrog Well-Known Member

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    No issue for us.
     
    Nodrog, 25th Mar, 2020
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  8. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    No. None of the Big 4 banks, or any other lender classified as a 'Bank' withdrew or did anything nasty with their offset facilities during the GFC.
     
    Peter_Tersteeg, 25th Mar, 2020
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  9. Trainee

    Trainee Well-Known Member

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    Did RAMS, for example, cancel redraws when they became illiquid and were taken over?
     
    Trainee, 25th Mar, 2020
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  10. Citycat88

    Citycat88 Well-Known Member

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    I had money in redraw with BankWest at that time, and nothing like that happened, so even less likely for an offset account.
     
    Citycat88, 26th Mar, 2020
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  11. Hetty

    Hetty Well-Known Member

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    Had this been confused with redraw maybe?
     
    Hetty, 26th Mar, 2020
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  12. virgo

    virgo Well-Known Member

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    I have both in Offset and Redraw...

    Are you implying Offsets are safer but Redraw is not???
     
    virgo, 26th Mar, 2020
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  13. Trainee

    Trainee Well-Known Member

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    Depends if you think offsets are bank accounts and redraw is like an open credit line. Personal opinion only / do your own research / not advice etc but closing an unused credit line is more likely than bank accounts being taken.
     
    Trainee, 26th Mar, 2020
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  14. Hetty

    Hetty Well-Known Member

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    I’m no expert, it’s my understanding they can take redraw but they can’t take an offset. Someone on here should be able to confirm (or rebuke)
     
    Hetty, 26th Mar, 2020
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  15. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Under the terms of most loan agreements they could potentially cancel redraw facilities and apply any cash you have in any accounts with them against any debt you have. So they could 'get' both.

    But this doesn't mean they will.
     
    Terry_w, 26th Mar, 2020
    #15