I recently refinanced my home loan onto an honey money period @7.19% for the first year then reverting to standard variable rate -0.75% for the rest of the loan life. No fees whatsover incurred to refinance. I have also a redraw facility. I use my home loan as a transactional account meaning that everything I have to pay mostly credit card bill comes out of the redraw once a month and salary goes in as soon as received.
I explain to my bank that I was using this home loan as a transactional account and they said to me that a line of credit would be better for me even though it is more expensive I believe it is around 7.49% as a line of credit is designed as a transactional account.
My question is in what way would it be more interesting for me to switch from my current home loan to a line of credit that is more expensive (interest rate wise) ? Am I missing something ? My aim obviously being to repay my loan as soon as possible.