A redraw facility is one of the most popular loan features available as it gives you flexibility as well as allowing you to minimise your loan size, and interest payable, at all times. Additional repayments can be made into your loan account and if you would ever like to access those funds, you can redraw them. Instead of having a separate ‘non-everyday’ savings account, any extra accessible funds can be used to reduce your loan account whilst being available to you as necessary.
Most mortgage products, other than the basic home loans, offer a redraw facility. There are a few areas for consideration when assessing loans with a redraw facility such as account setup fees (which can cost up to $300), the amount of free redraws available each year, the potential maximum amount of redraws per year, and the minimum and maximum redraw amounts.
