|
If you want to pay off your home loan as soon as you can, but want to keep other savings as well, a NAB Loan Trimmer is the answer.
It not only saves you time and money on your home loan, but can also save on tax as well.
How does it work?
Normally, any deposit accounts you hold with NAB earn interest. But with a NAB Loan Trimmer, no interest is earned on your deposits. Instead the interest rate that would have otherwise applied to your deposit accounts is used to reduce the interest rate charged on your NAB Tailored Home Loan.
NAB Loan Trimmer may be an effective tax arrangement because you do not earn any interest on deposits that would normally be treated as income and subject to taxation at your normal marginal rate.
Example only
For example, say you have a NAB Tailored Home Loan of $110,000 with an interest rate of 9.25%* pa, and $20,000 savings with NAB earning 4.5% pa interest. With NAB Loan Trimmer, you no longer earn interest on your $20,000 savings. But you also no longer pay 9.25% interest on the full amount of your home loan. Instead you would pay 9.25% pa on $90,000 and a reduced rate of 4.75% pa (ie 9.25 minus 4.5 = 4.75% pa) on $20,000 (the equivalent of what you have in your savings).
NAB Loan Trimmer is available with:
- NAB Passbook
- NAB Cash Management Account
- Most NAB Term Deposits
* The interest rate is an example interest rate to demonstrate how Loan Trimmer operates. Refer below to the current interest rate applicable to NAB Tailored Home Loans.
|
