# Positive-Balance Offset and Redraw Account Setup > This article will provide the steps needed to set up Positive-Balance Offset and Redraw Accounts in YNAB. Source: https://support.ynab.com/en_us/positive-balance-offset-and-redraw-account-setup-rk11XHIlh Last updated: 2026-07-02T17:11:43.773Z Set up positive-balance offset and redraw facility accounts in YNAB by creating two accounts: a Tracking account for the debt and a Cash account for the positive-balance offset or redraw account. Learn more about these unique account types, including how to handle mortgage payments and interest charges through these accounts. #### In This Article [Overview](#overview) [How to Set Up a Positive-Balance Offset Account](#offset) [How to Set Up a Redraw Facility Account](#redraw) * * * ## Overview A Positive-Balance Offset Account or Redraw Facility is a positive-balance transaction account linked to a mortgage account. The balance in the account reduces the amount of interest paid on a home loan. Does your account have a **negative** balance? You'll instead want to check out our resource for [Negative-Balance Offset Accounts](https://support.ynab.com/en_us/negative-balance-offset-accounts-HkPKvOCc) which is written specifically for accounts that operate with a permanent negative balance, typical for permanent overdraft and mortgage accounts in certain areas. #### YNAB's Loan Account Type and Positive-Balance Offset Mortgages The YNAB Loan accounts use the current balance of the loan (plus the monthly payment and interest rate) to calculate the payoff date, remaining interest to be paid, and the monthly interest charges. Since these loans calculate interest by subtracting an offset account balance from the loan's balance, there isn't a way to change the YNAB Loan account formulas to include the positive-balance offset account balance. In short, they don't work together. [Back to Top](#backtotop) * * * ## How to Set Up a Positive-Balance Offset Account To do this, you’ll [set up two accounts](https://support.ynab.com/en_us/how-to-add-an-account-ByoxswMJs) in YNAB. A **Tracking account** for the debt, and a **Cash account** for the positive-balance offset account. 1. Add the mortgage account as a Tracking account using the liability account type. This will allow you to keep track of your total amount owed. 2. Add a Cash account using the checking account type to represent the positive-balance offset account. This account will have a positive balance equal to your current balance at the bank. 3. Create a category in your plan for your mortgage payments. You’ll record your payments to your mortgage account as [transfers](https://support.ynab.com/en_us/transfer-transactions-a-guide-HJOsZz4Jj), and interest charged as outflow transactions in the Tracking account. 4. Assign every dollar in the Cash account to categories. [Back to Top](#backtotop) * * * ## How to Set Up a Redraw Facility Account A redraw facility lets you access extra repayments you've made on your home loan. You might think of these as savings dollars that you can redraw when the time comes to use them. If overpaying your mortgage is putting you closer to the financial edge, our best recommendation is to avoid sweeping those funds into the mortgage account. To assign your redraw facility to categories, while tracking your debt, you’ll [set up two accounts](https://support.ynab.com/en_us/how-to-add-an-account-ByoxswMJs) in YNAB. A **Tracking account** for the debt, and a **Cash account** for the redraw facility. ### How to Set Up a Redraw Facility Account 1. Add the mortgage account as a Tracking account using the liability account type. This will allow you to keep track of your total amount owed. 2. Add a Cash account using the savings account type to represent the redraw facility. This account will have a positive balance equal to your current redraw amount. 3. Create a category in your plan for your mortgage payments. You’ll record the payments to your mortgage account as split transfers (steps available below) from your Checking account. Interest charged will be an outflow transaction in the tracking account. 4. Next, you'll create a category group in your plan to assign the redraw facility. Keep in mind, there isn't anything in YNAB that [links a specific group of categories to an account](https://support.ynab.com/en_us/category-balances-versus-account-balances-an-overview-ryvnKB_Ac). You will want to be careful not to assign those dollars to your regular spending categories. If you redraw them, you can assign them to categories. ### Entering a Split Transfer A split transfer will be used when your payment includes a mortgage payment **and** an overpayment for the redraw facility.  We recommend entering this on the web app. If you pay the same amount each time, you can set this up as a [scheduled transaction](https://support.ynab.com/en_us/scheduled-transactions-a-guide-BygrAIFA9). #### How to Enter a Split Transfer for a Redraw Facility 1. Click on your Checking account in the left sidebar. 2. Click _Add Transaction_. 3. Under Category, select Split (Multiple Categories). Enter the total payment in the Outflow column. 4. On the next line, under **Payee** choose the mortgage account you're transferring to in the **Payments and Transfers** section. Select the mortgage category and enter the amount you're transferring for the mortgage payment as an outflow. 5. On the following line, under **Payee** choose the redraw facility account you're transferring to in the **Payments and Transfers** section. Enter the amount you're transferring for the redraw portion as an outflow. 6. Click _Save_. The transfer to the mortgage account will reduce your debt, while the portion you’re able to redraw increases the amount in your redraw facility account. Because the redraw facility is a Cash account, you won’t assign a category for that portion. Nothing changes in the plan because money hasn't entered or exited the plan. If you need to change the plan you have for your spending, [move money](https://support.ynab.com/en_us/moving-money-in-your-plan-ryyCKbBJi) from one category to another. #### When to Make a Transfer Transaction Instead Making a payment that includes **only** the mortgage (and **no** overpayment)? Set that transaction up as a [transfer](https://support.ynab.com/en_us/transfer-transactions-a-guide-HJOsZz4Jj) instead of a split transfer. 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