Need to pause your mortgage payments?
If COVID-19 has impacted your income to the point where you may need to pause your mortgage repayments, the banks now have deferral policies in place for you.
Late last week the Australian Banking Association (ABA) announced that small businesses affected by the coronavirus would have their loan repayments deferred for six months.
But when it came to home loan customers, there was no similar, wide-sweeping announcement from the ABA.
Rest assured though that all the big four banks are allowing customers who have been impacted by the coronavirus to hit pause on their mortgages for up to six months with some small lenders allowing deferral relief measures as well.
All CBA home loan customers are now eligible to defer loan repayments by up to six months. A digital registration process is available for any home loan customer wishing to defer their repayments.
Here’s a full statement on the support CBA is providing for personal customers.
“Westpac customers who have lost their job or suffered loss of income as a result of COVID-19 should contact us for three months deferral on their home loan mortgage repayments, with extension for a further three months available after review,” the bank said in a statement.
Here’s the statement and support package details in full.
Home loan customers experiencing financial challenges will be able to pause their repayments for up to six months, with NAB checking in after three months.
For a customer with a typical home loan of $400,000, this will mean access to an additional $11,006 over six months, or $1,834 per month, NAB says.
Check out their statement for more details on their support package.
If you’re experiencing financial difficulty due to COVID-19, ANZ may be able to support you by putting your home loan repayments on hold for six months, with interest capitalised (see below).
If you pause your repayments, ANZ will check in with you after three months.
ANZ have also released a statement detailing their full customer support package.
It’s important to note the banks only state that they’ll defer your repayments – it’s likely they won’t stop interest from accruing on your home loan.
Basically, that means your home loan amount will continue to grow while repayments are on pause, as any unpaid interest will be added to your outstanding loan balance.
With that in mind it’s worth noting there are other options you can explore to reduce your home loan repayments each month besides hitting the pause button, so please contact us or call our office on 1800 618 800 if you’d like to learn more.