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!
     
  2. The Y-man

    The Y-man Moderator Staff Member

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  3. virgo

    virgo Well-Known Member

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  4. The Y-man

    The Y-man Moderator Staff Member

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  5. Terry_w

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

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    Never heard of that happening.
     
  6. Gockie

    Gockie Unicycle - get exhausted but never two tired Premium Member

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    I didn't either. I just remember the rapid decrease in interest rates :)
     
  7. Nodrog

    Nodrog Well-Known Member

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    No issue for us.
     
  8. Peter_Tersteeg

    Peter_Tersteeg Well-Known Member 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.
     
  9. Trainee

    Trainee Well-Known Member

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    Did RAMS, for example, cancel redraws when they became illiquid and were taken over?
     
  10. george costanza

    george costanza 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.
     
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  11. Hetty

    Hetty Well-Known Member

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    Had this been confused with redraw maybe?
     
  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???
     
  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.
     
  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)
     
  15. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus 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.