What is a loan structure (facility)?

A loan facility structure describes how a home loan is arranged and divided into distinct parts rather than a single account. While the loan product is the underlying agreement between you and the lender, the facility structure is the architecture that holds it: how the money is split, where it sits, and how the pieces interact.

Typical structures include:

• Multiple splits, where portions of the loan carry different interest rates or repayment terms (for example, fixed and variable rates in one facility).
• Offset sub-accounts linked to loan splits, allowing savings held in those accounts to reduce the balance on which interest is calculated.
• Redraw facilities on certain splits, giving you access to paid-down principal.

Why it matters: the way a facility is structured affects how much interest you pay, how flexible your repayments can be, and whether you can redirect extra payments strategically across splits. A facility with an offset account and multiple splits may help you service your mortgage more efficiently than a simple single-split loan, though it depends on your situation and how you use it.

Mortgage brokers in Perth often help clients design a facility structure that aligns with their financial goals. The structure is set up when the loan is approved and can sometimes be adjusted later, though changes may incur fees or refinancing costs.