When thinking about how to budget for your home loan, it is important to understand your loan repayments and how they might be able to benefit you in the future. How you choose to make your repayments can have a big impact on the overall cost of your home loan.
If you are experiencing difficulty meeting your loan repayments due to the impacts of coronavirus (COVID-19), please get in touch with us as soon as possible. We have a dedicated team here to help. As we are currently experiencing a high volume of calls from customers, you can apply for financial hardship assistance by filling out our financial hardship form online and we will respond to you as soon as possible.
As a Keystart customer, you'll have chosen to make your repayments weekly, fortnightly or monthly to meet your minimum monthly repayment.
We calculate weekly and fortnightly repayments based on your minimum monthly repayment.
Let's look at an example:
For a minimum monthly repayment of $1,200, weekly repayments would be $1,200 ÷ 4 = $300. Fortnightly repayments would be $1,200 ÷ 2 = $600. Note: other lenders may calculate weekly payments differently (eg, yearly payment ÷ 52)
Paying more than your minimum repayment amount puts you into what we call an advance position. If you continue to pay more than your minimum repayment amount, you will build up your advance position over time. This will help you become debt free faster and reduce your monthly interest charges. It may also assist you in getting into a good position to refinance to another lender.
Keystart does not charge fees for making additional payments or paying out your home loan early. We'll just need 24-48 hours notice if you need to make changes to your scheduled repayments.
You don't have to make any additional payments but if you decide this is the right option for you and your home loan, you can contact us or make changes to your direct debit payments via your Client Portal.
You can also make once-off payments via BPay whenever you wish. BPay payments can be made to Keystart via online banking or at any Australia Post outlet. If you do not have your Keystart BPay card available, get in touch and we can assist you.
By making more frequent loan repayments, you’re decreasing the size of your loan more often, lowering the amount of interest charged. The difference might not seem very obvious in the short term but over the course of your loan, you could save thousands of dollars.
You can change your repayments to weekly, fortnightly or monthly at any time. Just get in touch so we can help set that up for you.
If your repayments are scheduled on a date that does not suit you, we may also be able to change this to a more convenient date. This is dependent on when your minimum monthly repayment is due and your available advance position.
Please note we can't change the date when your minimum monthly payment is due by.
If you are in advance of your scheduled payments you may be able to defer or reduce a loan repayment if needed. This can help you manage any unexpected expenses.
When considering deferring a payment, you need to decide whether this is the right option for you. Using funds from your advance position to defer payments may result in an increase to your required minimum monthly repayments in the event of a change or recalculation of your loan, for example a change in interest rate. If a change is made in your repayment amount, this is to ensure the loan is still paid in full by the end of your loan term.
Get in contact to find out more about this facility. Keystart can assess the current status of your advance position and let you know your options.
We'll need 24-48 hours notice to make these changes to a scheduled repayment.
You can keep an eye on your account and available advance position through the Client Portal.
At Keystart we do things a little differently to other lenders. Unlike other mortgage lenders, we don't have an offset account facility available to our customers. However, we do provide an alternative service called a redraw.
If you are paying above your minimum monthly payments consistently, your advance position will build up over time and you may be able to arrange a redraw.
We assess each request for a redraw on a case-by-case basis. We do a review of your loan situation, including any changes in your income and any other debts outside of your home loan. The amount you may be eligible to redraw will be based on this review. It may be that a redraw is not suitable based on your financial situation.
When considering a redraw, you need to decide whether this is the right option for you. Redrawing funds from your advance position may increase your minimum monthly payments to ensure the loan is still paid in full by the end of your loan term.
We recommend that you seek your own independent financial advice prior to making any decisions about your financial needs.
Our redraw facility is not available to customers with a shared ownership loan.
Contact us if you would like to apply for a redraw.
At Keystart we understand life can take unexpected turns and situations change. If you are concerned about your situation or your ability to make any of your scheduled repayments, please contact us as soon as possible to discuss your options. You can read more, including access to financial counsellors, on our financial difficulty page.