Hi everyone, trying to work out if making fortnightly payments works in my favour or not.
Let’s say I have a $650,000 mortgage broken into:
$200,000 variable
5.30%
$100,000 offset
$450,000 fixed
5.25%
Am I right in assuming I’m better off making repayments monthly as the funds sitting in offset for the full 30 days is more beneficial than reducing mortgage balance (and offset) fortnightly?
If my logic is correct, as long as the variable rate is higher then I’m better off with monthly repayments, however if variable is lower then it favours fortnightly repayments.
It only makes a difference if you don’t have an offset. In the above situation it doesn’t matter if you choose fortnight vs monthly except for managing cash flow.