Firstly our small team at AXTON Finance hope that you, your friends and your family are looking after yourselves during this time. Please listen to government advice on how you can play your part to keep yourself and others safe during this pandemic.
Australian banks and lenders pitch in
On Friday 20th March The Australian Banking Association (The ABA) announced a unified response to assist Australians during this crises.
Below is a summary of COVID19 links available from each lender in the Australian market place.
This page is being updated as more information comes to hand.
Key points to consider - our brief summary
- The term 'repayment holiday' SHOULD NOT be interpreted as interest being waived. It is only repayments (interest) being deferred. You still have to pay the capitalised interest added to the loan balance in the future.
- Qualification requirements are likely to apply (eg unemployment, significantly reduced hours, at risk industry etc)
- Our opinion is that the deferred repayment should be used where genuine hardship is being experienced or is expected. In the long term adding (capitalising) interest for six months or more can add a significant amount of interest to your total loan cost.
- Most lenders are offering up to six months relief in repayments. Some are offering up to three months with a checkin at that point for a further three months.
- Credit reporting agencies and lenders have already outlined that the hardship arrangements are typically not reported as defaults, and therefore do not impact a borrower’s credit score, with APRA also stating on Monday 23rd March 2020 that banks need not treat repayment holidays as arrears.
- The very cheap fixed options we are starting to see should be considered carefully. Often you cannot make extra repayment on a fixed rate, there is often no redraw and expensive break costs can also apply should you pay the loan out early.
- It may be economical to consider refinancing to a new lender to take advantage of cheaper rates, a new interest only term or one of the current cash back rebates available before you simply defer your repayments.
Speak to your AXTON broker if you would like a mortgage review (click here for a free review) or to discuss any of the points above.
Useful COVID19 Lender Links
Bank Of Melbourne (click link on main page to COVID Information)
Bank Of Queensland
If in doubt or if you just want to chat about your situation please contact your mortgage broker to assist where possible.
Contact details are as follows:
Our office number (03 9939 7576) is still actively being monitored as we run a full VOIP system and can be contacted as per normal.
Your team @ AXTON Finance
Photo by Branimir Balogović on Unsplash