ACCOMMODATION BOND LOAN
Frequently Asked Questions
- How can I have a loan and not have to make any repayments during the term of the loan - what's the "catch"?
- Do I lose ownership of my home, and can I ever owe more than the value of my property?
- What are your current interest rates?
- What happens if I die? Will you want your money back straight away, like in a 'fire sale', and who is in charge of selling my house?
- Will my Loan affect my children's and grandchildren's inheritance?
- What about my pension or social security benefits? Will these be affected by my Loan?
- What if I move out of aged care back into my home?
- Can I repay my Accommodation Bond Loan at any time?
- Can the loan be accepted if signed under a Power of Attorney?
- Why is there a 5 year limit to the term of the loan?
- What is the Customer Enquiries phone number?
- How can I have a loan and not have to make any repayments during the term of the loan - what's the "catch"?
- There is no "catch". The principles is that you are not required to make any repayments until the end of the term (5 years), or upon moving out of residential aged care, or upon death. Interest is accrued over the length of your loan, but is included in the final repayment amount.
Back to top - Do I lose ownership of my home, and can I ever owe more than the value of my property?
- No, and, no. You continue to own the property. And, because ABN AMRO's Accommodation Bond Loan has a No Negative Equity Guarantee, you can NEVER owe us more than the value of your home as long as you comply with the terms of the loan.
- What are your current interest rates?
- The current rates are available on the Interest Rates and Comparison Rates page. As you are aware interest rates fluctuate from day to day and are guided by the Reserve Bank, but we are determined to keep our rates as competitive as possible. Your fadviser will also have a copy of our current, low interest rates at the time of your application. You should also take into account the fact we have no monthly fees or charges when comparing our interest rates to other providers.
- What happens if I die? Will you want your money back straight away, like in a 'fire sale', and who is in charge of selling my house?
- Under the terms of your Reverse Mortgage, you have a 12 month period within which to sell the security property and repay your loan. As long as the proceeds are sufficient to repay the loan, the sale is left entirely in the hands of the Executor of your Will, or your family, depending on the details as set out in your Will. Once the property is sold, the loan and any interest accrued is repaid to us and the balance is divided according to the terms of your Will. Alternatively, your family could choose to keep the property and simply repay the loan. It is your choice.
- Will my Loan affect my children's and grandchildren's inheritance?
- Yes, it may, if you have decided that the proceeds from the sale of your property will be divided among your family. This is why we strongly emphasise the importance of discussing your decision to take out a reverse mortgage with ABN AMRO with all your family members and any other beneficiaries. Remember, you have the option to protect up to 25% of the value of your property as well.
- What about my pension or social security benefits? Will these be affected by my Loan?
- They may, which is why we urge you to talk directly to Centrelink, or your adviser, who will assist you accordingly.
- What if I move out of aged care back into my home?
- The Loan would need to be repaid within 12 months. This would probably be done through the return of your Bond by the aged care facility. If desired, at that point you could consider our Reverse Mortgage product to cover any other needs you may have, such as increased domestic support.
- Can I repay my Accommodation Bond Loan at any time?
- Yes. However, there is a discharge fee and if you voluntarily repay completely a fixed rate loan within the five year term you may incur Break Fees.
- Can the loan be accepted if signed under a Power of Attorney?
- Yes. Please submit a copy of the Power of Attorney with the Loan Application.
- Why is there a 5 year limit to the term of the loan?
- Our research showed that the biggest issue people faced was to raise sufficient funds to cover the loan. By limiting the term to 5 years we have been able to offer the 40% LVR limit. If you need a longer term option then please speak to our team on 1800 99 99 59 and we can explore the options available.
Our Customer Enquiries team are understanding and knowledgeable and will answer any further questions you may have. Just call 1800 999 959.