The big four bank has allowed borrowers to either move from Principal & Interest (P&I) to Interest Only (IO) for six or 12 months, or renew an IO period for six or 12 months.

Announced on Monday and effective immediately, any customers who wish to take advantage of the offer must contact an ANZ broker for approval.

Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
Principal & Interest
Featured Online ExclusiveUp To $4K Cashback
  • Immediate cashback upon settlement
  • $2,000 for loans up to $700,000
  • $4,000 for loans over $700,000
5.99% p.a.
5.90% p.a.
Principal & Interest
Featured Apply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

Eligibility criteria for the IO switch/extension includes:

  • The customer must not be requesting any additional lending
  • Loans must be either P&I or IO expiring within next 3 months
  • Customers are unable to split their loan under this process
  • The customer must be employed and currently receving income
  • Any reduction in income must be temporary and due to COVID-19
  • The ANZ loan being renewed must be at least 6 months’ old (for 6 months IO), and 12 months old (for 12 months IO).

Borrowers will be required to undergo a credit check to confirm their eligibility. 

In a statement released to brokers, ANZ said the offer was aimed at assisting customers who would like a short-term reduction in their repayment commitments.

"This process aims to assist customers who wish to proactively manage their cash flow during this period as an alternative to putting their repayments on hold under ANZ's COVID-19 Assistance offering," ANZ said. 

ANZ is the third big four bank to announce IO switches and extensions as part of COVID-19 support measures.

Commonwealth Bank (CBA) announced at the start of June it would be allowing customers to apply for a one-year IO extension, or switch if they are currently making P&I repayments, without requiring a serviceability assessment.

CBA Group Executive Angus Sullivan said the move was made to further support customers through the economic fallout from the pandemic. 

"We recognise that as the coronavirus situation evolves and customers start returning to work, they may require alternative temporary assistance measures to help them get back on their feet sooner," Mr Sullivan said. 

"As part of this we are temporarily allowing existing home loan customers to apply for a one-year interest-only extension or switch if they are currently making principal and interest repayments without requiring a serviceability assessment.

Westpac also announced in May it would allow eligible home loan customers to switch from P&I repayments to IO, or extend their current IO home loan term for a further 12 months without a serviceability assessment. 

In addition to IO switches or extensions, all three big four banks have offered support to home loan customers by allowing borrowers to defer repayments for six months.

Recent figures from the Australian Banking Association show lenders have granted home loan deferrals to 480,727 customers, whose total borrowings come to $173.4 billion.

Ready, Set, Buy!

Learn everything you need to know about buying property – from choosing the right property and home loan, to the purchasing process, tips to save money and more!

With bonus Q&A sheet and Crossword!

By subscribing you agree to our privacy policy