A 100% Offset home loan is a home loan that comes with a linked bank account which is called an offset account. This offset account operates very much the same as a normal bank account, with one difference, the balance of the account reduces the amount of interest you pay on the linked home loan. Basically, when interest is calculated on the home loan, the balance of the offset account is deducted from the balance of the home loan to determine the amount of interest payable. As an example, if you have a home loan owing $300,000, and you have $25,000 in your offset account, the interest will be calculated as if you owed only $275,000. The effect is the same as if you had deposited the $25,000 directly into the loan itself. Interest is calculated on a daily basis. An All-in-One Home loan operates on the same principle, with the difference being that the offset account and home loan are merged into one single account. Your salary can be deposited directly into your Home Loan account.