Mortgage holiday over for almost half a million borrowers

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on September 07, 2020
Mortgage holiday over for almost half a million borrowers

Source: Twitter

Lenders have begun to contact borrowers who have deferred mortgage repayments to see whether they can restart payments.

The six-month mortgage holiday offer that almost 500,000 Australians took up has come to an end, and banks are now discussing with customers what the next stage of support and assistance may look like. 

More than 900,000 loans have been deferred since the start of the pandemic, and at least half of that number will be assessed in the coming weeks. 

Of the loans deferred, 262,000 are home loans, of which 80,000 will be assessed by the end of September, and 180,000 by the end of October. 

Over 105,000 business loans to small and medium businesses have deferred loan repayments, and 65,000 of these will be assessed by the end of September, and 40,000 by the end of October. 

Looking to compare low-rate, variable home loans? Below are a handful of low-rate loans in the market.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
FixedMore details
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.

Rates correct as of January 22, 2022. View disclaimer.

Australian Banking Association (ABA) chief executive Anna Bligh said the operation to assist customers experiencing financial hardship was massive but vital. 

“The loan deferral measure offered to customers by Australia’s banks has led to the largest ever customer contact process in the industry’s history, with an additional 5000 new or redeployed staff working to ensure customers understand their options," Ms Bligh said.

“Customers know what’s best for them. It’s the bank’s job to set out all the options and implications and ensure customers have the information and the time to make the right decision to suit their needs.”

For borrowers who have deferred loan repayments, lenders will outline the following steps: 

  • Those who can resume repayments at the end of their deferral will be required to do so;
  • Those still in difficulty, will work with their bank to restructure or vary their loan, including converting to interest-only payments for a period of time, or extending the term of the loan;
  • Following the assessment, once the bank understands the customers' circumstances, in some cases, a further 4-month deferral may be granted, but this will not be automatic; and
  • Customers who will be unable to pay their loan over the longer term will be offered tailored assistance that addresses their needs 

Of the 900,000 deferred loans, 13% had resumed repayments by the end of July, with lenders estimating an additional 100,000 borrowers had resumed repayments in August. 

"As customers who are able to begin their repayments again, it allows banks to focus their support on those who really need it.” Mr Bligh said. 

ANZ launches free home loan check-in

ANZ has launched a free 15 minute home loan check-in to review how much borrowers' repayments are, their frequency, how long it will take to pay off the loan and how much equity there is. 

ANZ Home Loans General Manager John Campbell said the scheme encourages borrowers to be proactive in managing their home loan. 

“Home loans are one of the largest financial commitments households will make in their lifetime and it should not be a ‘set and forget’," Mr Campbell said.

"With so much change and uncertainty at the moment, what was best for you when you first took out the loan may no longer suit your current needs."

The check-in is open to everyone, doesn't require any paperwork or preparation, and can be done over the phone or in-branch. 

ANZ Home Loan Check-In Ambassador Angela Sibley said the check-in helped to manage her family's finances after her husband lost her job. 

"When we did the Check-In, it was a great personalised conversation. The fact that you can talk to a real person is very reassuring, especially during uncertain times," Ms Sibley said.

"We asked questions and they answered them openly and reaffirmed our decisions.

"If anything, it’s just stressed how important ongoing management of your home loan actually is."


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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Alex joined Savings.com.au as a finance journalist in 2019. He enjoys covering in-depth economical releases and breaking down how they might affect the everyday punter. He is passionate about providing Australians with the information and tools needed to make them financially stable for their futures.

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