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Home Mortgage Offset Account
Assalamoalaikum brothers,
I have asked a bank in Australia about ‘Home mortgage offset account’ and they have replied below quoted within inverted comms.
“In a technical sense, an offset account does not pay interest. Instead, it prevents you from paying extra interest on a home loan. An interest-bearing account is similar to a savings account in that it calculates interest based on the amount in your account up to a certain limit; it usually has much lower rates on average than the home loan rates; and it requires you to pay tax on any interest earned because it is considered income. While you may only receive a small amount of interest in a savings account, the money works considerably harder in an offset facility, saving you thousands of dollars rather than earning a moderate amount of interest as you would in a bank.”
What is Javaid sahab’s opinion on it? In absence of his direction, is there any brother who has knowledge on this matter – can shed light on it please?
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4 Replies
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Home Mortgage Offset Account
updated 6 days, 21 hours ago
2 Members
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Replies
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I have already expressed my understanding here:
Discussion 69503 • Reply 69784
Discussion 69503 • Reply 70283
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Permissibility Of Offset Mortgage - Ask Ghamidi
Assalamoalaikum Brothers,I have listened to Ustaaz Javaid Ahmad Ghamidi Sb 23 Eteraz Series on “Sood”.Is there anywhere Javaid sb explained whether
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JazakAllah brother Umer,
Yes I remember that detailed enlightening discussion with you few years ago and even after my latest discussion with Australian bank that I quoted above I am still stuck at the same point i.e., Whether to take caution or use this offset facility to save money on mortgage. However, as more I dig into banking business more it seems that majority of what I am getting back from them has primarily RIBA in it but then house Mortgage business / other business investments are not RIBA therefore it is that argument that Javaid Sahab has mentioned in his clip one can make.
I think you have given a clear answer from your point of view and I can also see Javaid Sahab has given very clear stand point in attached clips.
Thank you so much.
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Jee – Inshaa Allah I will register and will try to attend. Thank you.
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