Bank "Glitches" Are Costing Mortgage Holders Thousands Is Yours One of Them?

Picture a borrower who did everything right: she opened an offset account the day she settled her home loan, parked her savings there, and assumed the interest on her mortgage was being calculated correctly every single month. Three years later, she finds out her bank never properly linked the account. She has been paying interest on money that should have been offsetting her loan the entire time and had no way of knowing. This is exactly the scenario the corporate regulator has just confirmed is playing out across the country, which is why more homeowners are turning to an experienced mortgage broker in Australia to keep their bank honest.

What ASIC's Review Actually Found

The Australian Securities and Investments Commission examined how eight major banks including Commonwealth Bank, Westpac, ANZ, Macquarie, ING, AMP, HSBC and Great Southern Bank set up and managed offset accounts across 204,000 home loans. The findings, published as ASIC's 26-173MR media release, were blunt: some banks could not even confirm whether a customer had requested an offset account, and in several cases the failures only came to light once ASIC began asking questions. Banks have already repaid more than $55 million in compensation, and with roughly $349 billion sitting in Australian offset accounts as of March 2026, regulators expect more payouts to follow.

How These Failures Slip Through Unnoticed

The reason this issue is so widespread is that it's largely invisible. Your repayment amount stays exactly the same whether your offset account is linked correctly or not, so there's no obvious red flag on your statement. Behind the scenes, though, an unlinked or mismanaged offset account means your bank is calculating interest on your full loan balance instead of your loan balance minus your savings quietly extending your loan term and inflating the interest you pay over its life.

What This Means If You Have (or Want) an Offset Account

For the roughly 55% of Australian borrowers already using an offset account, this is a timely prompt to log in and confirm the account is clearly listed as linked to your home loan, and that the interest charged lines up with your outstanding balance after your offset savings are factored in. For anyone shopping for a new loan, it's also a reminder that not all lenders administer offset accounts equally well loan structure and lender track record matter just as much as the headline interest rate.

Why a Broker Is Worth Having in Your Corner

This is precisely the kind of detail a good broker is built to catch. Rather than relying on a single bank to mark its own homework, a broker compares offset features, fees and administration quality across dozens of lenders, and can flag discrepancies in how your interest is being calculated before they cost you thousands. If your current lender's offset practices leave something to be desired, a broker can also walk you through what refinancing would actually save you, factoring in exit costs, rates and the new lender's own track record rather than you having to work it out alone from a banking app.

Five-Minute Checks You Can Do This Week

Log into your loan account and confirm your offset account is visibly linked to your mortgage, not just sitting as a separate savings product. Then do the maths: your monthly interest charge should reflect your loan balance minus your offset balance, not the full loan amount. If the numbers don't add up, raise it with your bank directly, or ask a trusted adviser to check the figures for you. Given how easily these errors go undetected, according to Moneysmart's guidance on offset accounts, it's worth building this check into your regular financial routine rather than a one-off exercise.