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Banks Announce Mortgage Loan Support Extension

Wed July 8, 2020

Are you experiencing ongoing financial issues? Australian banks have announced that they will support customers by extending mortgage repayment deferrals by another four months, where applicable.

Melbourne is entering their second round of Covid-19 shutdowns this week. At least there is a silver lining with The Australian Banking Association (ABA) and major banks confirming that they are implementing a new phase of support for home loan/mortgage customers impacted by the pandemic.

Many of the 800,000 bank customers who had deferred their repayments have already begun repaying their loans following an initial three-month hiatus. While many more will look to do so at the end of their six-month deferral period (the maximum term allowed under the previous COVID-19 support package).

However, following discussions with APRA and ASIC to provide the appropriate regulatory treatment (and with interim authorisation granted by the ACCC), the banks have now agreed to extend this support package on a case-by-case basis for customers who require it.

Customers with reduced incomes and ongoing financial difficulty due to COVID-19 will be contacted by their banks. If they cannot return to repayments or restructure/vary their loan to support their current financial situation (for example by extending the length of the loan or converting to interest-only repayment for a period of time), they may be able to extend their repayment deferral by another four months (ending no later than 31 March 2021).

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