The COVID-19 Crisis – What Relief Lenders are Offering
As a global community we are currently experiencing an unprecedented set of circumstances in the wake of the COVID-19 pandemic both medically and economically. Over the past week we have seen lenders start to announce relief packages and hardship policies they will roll out to those who are affected.
The following is a snapshot of the key measures to mortgage holders so far announced.
- Reduction in variable rate loans by 15bps from 27th March 2020.
- Introduction of a 2 Year Fixed Home Loan at 2.19%. ( Owner Occupied P&I repayments, Comparison Rate 4%)
- Clients impacted by COVID-19 may be eligible to put their loan repayments on hold for up to six months.
- Decrease variable interest small business loan rates by 25 bps, effective from 27 March 2020.
- Cuts to one, two and three-year fixed owner-occupied principal and interest (P&I) loans by 70 bps to 2.29% – effective for both new and existing customers from 1st May. ( Owner Occupied P&I repayments. Comparison Rates 4.13%, 3.99%, 3.87%)
- Automatically reduced repayments for all variable P&I home loan accounts (to the minimum required within the borrower’s loan contract), effective from 1 May. However, borrowers will have the opportunity to opt out if they wish to retain their current principal repayment levels; and
- The option to defer loan repayments by up to six months.
- Ability to pause home loan repayments for up to six months, including a three-month checkpoint, entailing access to additional funds.
- Option of reducing repayments on variable rate loans
- Reduce fixed rate home loans by up to 60bps
- Reduce variable rates on small business loans by 100bps effective 30th
- Offer customers effected by loss of income as a result of COVID-19, deferrals for up to three months on home loan mortgage repayments with an extension for a further three months available upon review.
- Small business customer may receive repayment holidays for up to six months.
- Roll out a 2.29% fixed rate home loan for one, two and three years for owner-occupied customers on P&I repayments with a Premier Advantage Package, effective Friday, 27 March 2020. (Comparison rates 4.42%, 4.24% and 4.08% )
- Cuts to interest rates by 25bps for one, two and three fixed home loans with rates starting at 2.39%.
- Cutting interest rates up to 100bps on business loan products.
- Increasing interest rates for everyday savers by 100bps to 1.35% for balances up to $1million.
- Enabling customers to access term deposit funds without a reduction in interest rate.
- Will defer loan repayments on a case by case basis for customers affected by the virus.
- Cuts to fixed rate home loans to 2.29% on a two-year term and 2.49% on three-year terms. (Owner occupied P&I repayemnts, Comparison Rates 4.88% and 4.90%)
- Offering 1.70% term deposit rates between six and twelve months.
- Reduce the interest rate for existing Business Essentials variable loans to a maximum rate of 3.69 per cent for residentially secured lending and a maximum rate of 3.99 per cent for commercially secured lending.
- Customers who lose their job or income source as a result of the virus may apply for a three-month deferral on their home loan repayments with extension for a further three months available.
- One, two and three year fixed rate products cut to 2.29%. (Owner Occupied P&I repayments. Comparison rates 4.47%, 4.29% and 4.12% )
- From Friday 27th March 2020, the introduction of a Term Deposit special offer of 1.7%% interest for 12 months. For customers over 65 the rate will be increased to 2%.
- Fixed home loan rate cuts of up to 134bps with rates starting at 2.19% for a two-year fixed product. ( Owner Occupied P&I. Comparison Rate 4.55% )
- Increasing six and 12 month term deposit rates to 1.80%.
- Option to suspend home loan repayments for up to six months with a review at three months.
- Repayment deferrals of up to 6 months on commercial loans for small business customers.
- A 3- to 6-month pause on home loans and personal loan repayments.
- A 3- to 6-month payment pause on credit cards.
- Record low fixed rates for home loan borrowers.
- Higher term deposit rates for savers.
- A cut of 0.35% to rates for existing commercial variable loans (under $3m), effective from 9 April.
- A pause on home loan repayments for clients experiencing financial pressure, for three months with the option to extend for a further three months.
- A range of new fixed rates for existing owner occupied and investment clients, including a 2.39% p.a. fixed rate for the 2-year Professional Package owner occupier P&I product. ( Comparison Rate 4.08% )
- Fee waivers for home loan clients in financial hardship.
- A waiver of the monthly account keeping fee for everyday and savings account holders, from 30 March 2020 until 1 October 2020.
- Access to a 1.80% p.a. term deposit rate across all available terms from 6 to 18 months.
We urge you to contact your lender if you wish to apply for financial hardship. Alternatively if you would like your broker to review your current lending to see if there is a more cost effective option available to you please contact us on 9429 5794.