Home loan redraw facility explained.
Home loan redraw facilities basics.
What’s a redraw facility?
It’s a feature on your home loan that lets you access any repayments that you’ve made above the minimum required repayments.
Reasons to redraw.
This money may come in handy to pay for expenses you didn’t see coming, like an emergency or investment opportunity. Or you might want to spend the money on planned things like renovations, holidays or a new car.
Redrawing the surplus funds in your home loan means you may not have to apply for another loan or a credit card. But keep in mind, redrawing your extra repayments will mean those funds are no longer reducing the interest on your home loan.
How much can you redraw?
You can redraw as much as you have in surplus on your eligible home loan. Make sure you’re able to make your repayments if you redraw all your surplus.
Can you redraw on a fixed rate home loan?
For Bankwest home loan customers, you can redraw on a variable rate home loan. If your home loan is on a fixed rate, you’ll need to wait until the end of your fixed rate term to redraw.
What’s the difference between a redraw facility and an offset facility?
An offset account works like a usual transaction account, you can freely access your money and it ‘offsets’ your home loan to help you save on interest. A redraw facility lets you access (re-borrow) any extra repayments you’ve made into your home loan and also helps you save on interest. Speak to us to understand which feature suits your situation best.
Repayment holiday.
Another way you may be able to use your surplus is to take a break from making your regular scheduled home loan repayments for a period of time. This could be useful if, say, you’re going on parental leave, taking a career break or changing jobs. Our Home Lending Specialists can talk you through what’s possible.
How to use a redraw facility.
If you have a variable rate home loan that only needs one person to authorise changes or payments, you can redraw your additional repayments through the Bankwest App and Bankwest Online Banking.
If your loan needs two people to authorise changes or payments, you’ll need to complete the Home Loan Access Withdrawal Authority Form (PDF) and return it to us using the details on the form.