Home loan redraw explained: how it works and when to use it - NAB

What is a home loan redraw?

Home loan redraw lets you acess extra money you’ve paid into your home loan above your required repayments. If you’ve been paying more than the minimum, you may be able to withdraw some of that extra amount when you need it. With NAB variable rate home loans, the amount you can redraw depends on how far ahead you are on your scheduled repayments and is calculated as your available extra repayments minus one scheduled repayment.

How to build and use redraw

Building up redraw

You build redraw by paying more than your minimum scheduled repayments or making lump sum deposits into your home loan.

Using the redraw facility

You may be able to use redraw once you’re ahead on your scheduled repayments and meet eligibility requirements, including not being in arrears on your loan or other accounts.

How redraw works

Here’s a simple example: Jason’s minimum monthly repayment is $1,000, but he regularly pays $1,500. Over time, this puts him $3,000 ahead on his loan. If eligible, Jason can redraw up to $2,000, leaving at least one scheduled repayment still paid in advance.

What can redraw be used for?

Redraw can be used for everyday expenses or larger purchases, such as replacing appliances, while keeping extra repayments within your home loan until you need them.

Things to consider about redraw

Accessing redraw 

You need to meet all eligibility requirements to access redraw.

Redraw amount

If eligible, you can redraw a minimum of $500 or up to $150,000 per transaction. Redraw funds can only be paid into an eligible NAB account.

What happens after a redraw?

Redrawing increases your home loan balance, which means the interest portion of your repayments will increase. If your existing repayment amount is not enough to repay the loan within the agreed loan term, your repayments will increase.

When to avoid redraw

Redraw may not suit if your goal is to pay off your home loan faster, as accessing extra repayments can extend the time it takes to reduce your balance.

Redraw for complex setups

Some loan types or structures, including loans held by a trust or company, require banker assisted redraw. For banker assisted redraw or to discuss your options, visit a branch or call 13 22 65.

Benefits of home loan redraw

Convenience

Withdraw the extra funds you’ve contributed into your home loan rather than applying for a separate loan to fund your next renovation project or personal purchase. It’s simple and easy to access through online banking.

Cost

Building your redraw reduces the interest you pay on your mortgage and potentially allows you to pay off your home loan sooner.

Flexibility

Making additional deposits into your home loan can allow you to take a break from future scheduled repayments as you’re already ahead.

Am I eligible to redraw?

Redraw is available if you meet all the following eligibility criteria.

Why can’t I redraw from my home loan?

Redraw is not available in the following cases.

  • The amount you wish to redraw is less than $500.

  • You have a fixed rate loan. Redraw is only available at the end of the fixed rate period (i.e., when the rate becomes variable).

  • You have a Defence Home Owner Scheme Loan (DHOS) established on or before 1 July 2010 and a building or construction loan.

  • You want to use redraw for business purposes.

  • You’re not at least one scheduled repayment ahead on your eligible variable rate home loan.

  • You (or any borrowers on the loan) have an account that is overdue or in arrears. Once the overdue account or arrears has been resolved, there can be a delay on the redraw restriction being lifted. 

  • Your loan is in the name of a Self-Managed Super Fund (SMSF).

There are other circumstances when we may cancel or suspend your access to redraw. It's important to view all these circumstances so you're aware of how your redraw can be cancelled or suspended. Read the full list in our important information section.

Redraw: Key takeaways

  • If you've made extra payments on your variable rate home loan, you can withdraw these using redraw.
  • The amount you can take out depends on how far ahead you are on repayments. You’ll need to be at least one scheduled repayment ahead on your home loan to redraw. 
  • You can increase your redraw balance by making lump sum deposits or regular additional payments into your home loan. Ensure that these payments are more than your minimum scheduled repayments. 
  • Given your home loan balance increases after a redraw, you’ll likely end up paying more interest with your repayments.

How to redraw from your NAB home loan

Ready to use some of your available redraw? It’s quick and easy to do online using the NAB app or NAB Internet Banking. Use our guide to learn how.

How to redraw from your home loan

The differences between redraw and offset

While both a redraw facility and offset accounts allow you to use your savings to reduce your loan balance, they do work in different ways. Read our article to help you decide which method works best to help you achieve your goals.

Learn more about redraw vs. offset

Explore other home loan topics

What is an offset account?

Learn about offset accounts, how they work and the benefits of a multiple offset arrangement.

The difference between redraw and offset

Compare your redraw facility and offset accounts to learn how they can work in different ways to help you meet your goals.

Why refinance your home loan?

Find out what refinancing is and why you should consider refinancing your home loan.
View all home and property articles

Our most popular home loans

Choose between a no-frills basic variable loan, variable interest rates or fixed interest rates loans.

Basic variable rate

Take advantage of our simple, low rate home loan with no ongoing fees.

Tailored variable rate with offset

Enjoy extra flexibility and features with a variable rate NAB Tailored Home Loan.

Tailored fixed rate

Gain additional certainty of a fixed interest rate with a NAB Tailored Home Loan.

Help and support

We’re here to help. Learn about the support services and help guides available to you.

Contact us for home loan related queries

This is how you can get in touch.

Start a conversation with a banker

  1. Log into either NAB Internet Banking or the NAB app.
  2. Tap on the message icon.
  3. Type ‘speak to a person’ in the conversation window.

Call us

Speak to a home loan expert about a new or existing home loan.

Monday to Friday, 8:00am to 7:00pm (AEST/AEDT)
Saturday to Sunday, 9:00am to 6:00pm (AEST/AEDT)

13 78 79

Book an appointment

Make an appointment to see us at your nearest branch, ask a mobile banker to come to you or ask us to call you back.

Talk to an expert

Terms and Conditions

The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, financial and taxation advice before acting on any information in this article.