25 Oct 2021

Tax-Efficient Borrowing Solutions

Borrowing Solutions

The way loans are structured can affect the amount of tax you pay and your ability to build wealth. At Mortgage House, we want all our customers to be able to optimise their mortgages and save money on taxes, which is why we offer a variety of tax-efficient borrowing solutions. We work with you to get a thorough understanding of your financial situation, allowing us to find the perfect loan product with a tax-efficient solution for you. Two of our most popular options are:

  • Borrowing the Maximum with an Offset Account
  • Interest-Only Home Loans

Borrowing the Most You Can and Utilizing an Offset Account

Did you know you can make your mortgage work for you? If you borrow the maximum amount of your loan and purchase a cheaper home, you can deposit the remaining loan money in an offset account. Your lender can only charge you interest on the difference between the amount outstanding on your loan and the amount in your offset account. Best of all, the interest is tax-deductible. For example, if you are eligible to borrow $400,000 and want to buy a $250,000 home, you can put the remaining $150,000 in an offset account. 

Interest-Only Mortgages

Another way to maximise your home loan is by combining your offset account with an interest-only mortgage. By having an interest-only mortgage for a set period of time, you can deposit the extra money not paid towards your principal into your offset account. Any interest payments you make while using the money in this offset account is tax-deductible. 

If you want to learn more ways to lower your tax burden and optimize your home loan, contact our lending specialists today to request an appointment.

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