Seniors Access Home Loan (SAHL) Product Specification

Transcription

1 Seniors Access Home Loan (SAHL) Product Specification For further information Mortgage Central This product specification is the property of St.George Bank. It is for the use of St.George Bank employees, contractors and accredited brokers only. It is not to be distributed to customers.

2 Product description The St.George Seniors Access Home Loan (SAHL) is a variable rate loan designed to assist people 63 years or over (minimum age is 65 in some lending areas) who own their home but have little cash for everyday living or things such as home renovations, an overseas holiday or a new car. The loan is secured against their owner occupied property and no regular repayments are required as long as borrowers live in the home. Repayment is deferred until all borrowers die, the property is sold, or borrowers are no longer living in the house (whichever occurs first). The loan will need to be repaid should the owner/s wish to lease/rent the property or have boarders within the premises. Key benefits / target market The St.George Seniors Access Home Loan enables retired people to utilise the equity in their home. Many retired people are now finding the increasing cost of living is eating into their savings and eroding their standard of living. These people have their home as their major asset but they are reluctant to sell and downgrade their home to generate cash. The St.George Seniors Access Home Loan is aimed specifically at these asset rich, income poor retirees and pensioners. The St.George Seniors Access Home Loan will enable the borrowers to remain in their home while being able to maintain a more comfortable lifestyle in retirement. Availability The St.George Seniors Access Home Loan is AVAILABLE for: New loans only. Owner Occupiers. Increases to existing Seniors Access Home Loans (conditions apply). Increases to existing Money For Living loans. The existing Money for Living loan will need to be refinanced and discharged by a new St.George Seniors Access Home Loan, which is opened for the balance of the Money For Living loan plus the additional amount requested. Important: Please ensure that customers are informed about the new interest rate and monthly fee. All Borrowers over 63 year of age (please note that there are differing LVR requirements, minimum age limit and maximum loan amounts in different lending areas see the Loan amount section). First mortgages only. The St.George Seniors Access Home Loan is NOT AVAILABLE for: Investors (or non owner-occupiers). Building loans. Flexible Choice. Switching. (Existing Seniors Access Home Loan customers who are increasing their loan may switch into the Seniors Access Plus Home Loan before the increase is processed and therefore, progressively draw down the approved increase amount). Further loans Company borrowers, 3rd party borrowers or Trustees. Relocation loans. Borrowers less than 63 years of age. Second or subsequent mortgages. Loans supported by Guarantors. Loan Advance St.George Seniors Access Home Loan funds may be advanced in one lump sum at settlement or drawn down progressively by using the Seniors Access Plus Home Loan until the approved loan amount is reached. Minimum progress drawdown is $500 No minimum time limit in which to draw the funds All borrowers must sign the form used for this drawdown. In the case of the death of one of the borrowers, then the surviving borrower(s) can still continue to drawdown the remainder of the available funds Scenarios No. of names on title No. of borrower/s Age of borrower/s /63 63/ /68 Eligible? Yes Yes No No No All mortgagors must be borrowers. All borrowers must be mortgagors. Page 2 of 6

3 Special conditions and requirements Requirements Prior to settlement, in addition to the standard documentation required for all loans, Seniors Access Home Loan borrowers must provide: 1. Evidence that each borrower has received independent legal advice (in a form that is acceptable by St.George Bank (also referred to as Bank depending on where in Australia the loan originates). The Bank will send the specific document required together with mortgage documents; and 2. Completed Financial Advice Certificate by a Financial Adviser/Accountant chosen by them (also sent to the borrowers by the Bank with the mortgage documents). Age of borrowers The minimum age for each borrower is 63 years (65 in some lending areas). Where two people are applying, both must be owners of the home and the younger partner must be no younger than 63 years of age. However please note that there are different LVR requirements, minimum age limit and maximum loan amounts in different lending areas. Loan amount / Loan to Value Ratio Minimum loan amount $10,000 If loan is a joint application and one customer is 65 and the other is 70+, then use the younger applicant s age to determine LVR and maximum loan amount available. Danger: There are no exceptions to these limits. Interest rate The interest rate will be the St.George Seniors Access Home Loan variable rate for both single draw and progressive draw down options. Reference: Refer to the interest rates and fees section of the website. Loan term There is no set loan term. However should any of the events detailed below occur, the loan contract ends and the total amount owing becomes payable: Upon the death of the last surviving borrower. Upon the sale or transfer of the security property. If the borrowers do not live in the property for a period of more than 6 consecutive months, the customer is required to advise St.George that they will not be living in the property (and obtain our prior consent). Age of youngest applicant Maximum loan amount NSW, Vic, Qld, SA & WA Metro areas (see Schedule A for metro area definitions) years $150,000 or 15% of years $150,000 or 15% of years $200,000 or 20% of 80+ years $250,000 or 25% of Maximum loan amount in other acceptable lending areas (see Schedule B - Other Acceptable Lending Areas for other acceptable areas definition) NA $150,000 or 15% of $200,000 or 20% of $250,000 or 20% of If a lease or licence is granted to occupy the security for a period of greater than 6 months, the customer is required to advise St.George that this property will be leased (and obtain our prior consent). If security property is materially adversely affected by the borrower s act or omission. If the borrowers have misrepresented their age or ownership of the property. Repayments One repayment of the total amount owing is required upon the death of the last surviving borrower or if the loan is in default. During the loan term, all interest amounts and other fees and charges are added each month to the balance owing on the loan account, therefore, increasing that balance. This is known as capitalising. The repayment required equals the total amount owing, which includes the original loan amount, and all interest and fees and charges that have accrued over the life of the loan. Page 3 of 6

4 Note: The customer is only required to pay the Bank an amount up to the total amount we can obtain by enforcing our rights under the mortgage. If we do not recover the total amount owing by enforcing those rights, we cannot sue the customer (or their estate) for the balance, or apply to have them made bankrupt. Principal reductions (voluntary payments) Borrowers may make payments during the term of the loan if they wish at any time. There is no charge for these payments. Any voluntary payments can only be made over the counter at branches or via phone banking or Internet. The over-the-counter fee is NOT charged when payments are made in-branch to either a Seniors Access Home Loan or a Seniors Access Plus Home Loan. Redraw / Access to Voluntary Payments Request to access voluntary payments made are permitted. Due to the capitalising nature of both the Seniors Access Home Loan and the Seniors Access Plus Home Loan, any request to access voluntary payments is to be processed as an increase to the existing loan. Note: The Seniors Access Plus Home Loan must be fully drawn down before any access to voluntary repayments request can be considered. Increases Existing customers may apply to increase their Seniors Access or Seniors Access Plus Home Loans providing the approved amount is within the LVR maximums for their age and the geographic location of the security property. Note: The Seniors Access Plus Home Loan must be fully drawn down before an increase request can be processed. Further loans are not permitted. Switches Customers with existing standard home or Portfolio loans may apply for the Seniors Access Home Loan to refinance their existing loan and all applications are subject to approval under the prevailing SAHL policies in place at the time of application. Existing Seniors Access Home Loan customers who are increasing their loan may switch into the Seniors Access Plus Home Loan before the increase is processed and therefore, progressively draw down the approved increase amount. Customers with Seniors Access Plus Home Loans may not switch into Seniors Access Home loans. Serviceability Not applicable Valuation A valuation is required at time of application for new loan or increase and at each 5-year review. Acceptable valuation types are a short form Valuation or a Rates Notice may be used where the loan amount is no more than $50,000 or 10% of the property value shown on the Rates Notice. Security The borrower s home must be unencumbered. If an existing mortgage is registered on the property this must be discharged (this may also mean that any associated loan must be paid out either with the proceeds of the Seniors Access Home Loan or from other resources), so that the Bank can lodge a first registered mortgage on the title. For an existing loan to be paid out from SAHL proceeds, the outstanding balance can be no greater than the maximum Seniors Access Home Loan amount permitted for the appropriate LVR/Age guidelines. The St.George Seniors Access Home Loan cannot be approved/settled if the Bank cannot obtain clear title in order to register first mortgage. The product is available only on Owner Occupied dwellings. Properties in a Retirement Village are unacceptable for St.George Seniors Access Home Loan. The following security is not permitted: Second Mortgage or subsequent mortgages (including St.George) Vacant Land Retirement Village units or holdings Hobby Farm Rural Land Non Residential, industrial or commercial properties Page 4 of 6

5 Multiple security properties Cash/Term deposit. Guarantees Lenders Mortgage Insurance Not applicable. Fees Refer to the interest rates and fees section of the website for current fees and charges. Establishment fee The fee includes the Bank legal fees for the new security property and one standard valuation for the primary security property. Administration fee Debited to the loan account each month. - There are different monthly administration fees for the Seniors Access and Seniors Access Plus Home Loans. The monthly administration fee on the Seniors Access Plus Home Loan is slightly higher than the standard monthly fee as it incorporates the ability for multiple progressive drawdowns without incurring additional transaction fees. Settlement Processing fee This fee is automatically deducted from the loan advance at settlement. Increase fee This fee does not include the cost of a valuation. The valuation fee for an increase is payable separately and may be charged to the loan if authorised by the borrower(s). Interest offset facility Customers with this product are able to have a Mortgage Equaliser Offset facility linked to their loan account. The Full Offset Service Fee is not payable on Seniors Access and Seniors Access Plus Home Loans. Partial Offset is no longer available for Seniors Access Variable Rate and Seniors Access Plus Variable Rate product type. Parties who are not on the Loan Account cannot be account holders of the Offset Account under any circumstances. Statements Statements are generated every six months. The statement cycle will be six months from the month of advance of the loan and every six months thereafter. Customers can nominate one of the borrowers to receive statements and notices on behalf of the other borrowers providing they all agree. Interim Statements / Replacement Statements These are available for mailing out on request. A fee is applicable. Refer to Loan Accounts Charges for specific services and accounts. Substitution of security Requests for Substitution of security permitted subject to the Bank s approval. Valuation of the new property to be conducted prior to approval (refer valuation requirements) LVR must be still with policy limits for borrowers age at the time of security substitution Simultaneous settlement required. Security to be substituted must be a like for like otherwise new loan is required. Substituted security cannot represent a reduction in security for the Bank. Additional security, by way of a mortgage offered over an extra property or by way of a guarantee, is not permitted. For example: Like for like is a ready built house substituted with a ready built house (a house under construction is not permitted) or 1st mortgage substituted for a 1st mortgage (1st mortgage substituted for a 1st mortgage with a guarantee is not permitted). Review process Every five years a full valuation will be conducted on the property. The fee for this valuation will be debited to the loan. Once the Bank has received the valuation a full review will be conducted on the loan. Up to 99 transaction accounts may be setup to offset the loan, provided the account holders of the Offset Account match those on the Loan Account. Offset Accounts cannot be linked to multiple loans. Page 5 of 6

6 Discharge Discharge of Mortgage fee applies refer Loan Accounts charges for specific services and accounts. This fee is payable to the Bank. It is in addition to the fee for the Registration of the Discharge of Mortgage, payable to the Land Titles Office. Schedule A NSW Sydney West to Blackheath, North to Brooklyn, South to Stanwell Tops, Northwest to Kurrajong Heights, Southwest to Picton ACT ACT Metro area as defined by ACT postcodes QLD Brisbane North to Redcliffe, East to Coast, South to Beenleigh, West to Upper Kedron Sunshine Coast East of Bruce Highway, South to Pelican Waters, North to Noosa Heads Gold Coast North to Coomera, South to Tweed Heads, West to Nerang VIC Melbourne North to Sunbury, East to Healesville, Southeast to Cranbourne, Southwest to Geelong, Northwest to Melton, Mornington Peninsula to Rosebud SA Adelaide CBD, North to Gawler, South to Aldinga, East to Adelaide Hills WA Perth West to Coastal Strip, North along Coastal Strip to Quinns Rocks, East to Bullsbrook, South to Fremantle & Mandurah, East to Mundaring, Armadale & Kalamunda Schedule B Other Acceptable Lending Areas For states other than SA & NT An area within 15 km of a town centre where there is a St.George branch and/or town with a population > or = 7,500. For SA & NT Existing Medium Risk Areas contact Mortgage Central on for more information End Procedure Seniors Access Home Loan Product Specification August 2012 For further information Mortgage Central This document is owned and updated by St.George Bank Intermediary Distribution and is subject to change. Terms and Conditions and fees and charges apply and are available on request. All applications are subject to St.George Bank s prevailing credit criteria. St.George Bank - A Division of Westpac Banking Corporation ABN AFSL STGW /12 Page 6 of 6