Reverse Mortgage Investment Property Mortgage Accommodation Bond Loan

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1 Reverse Mortgage Investment Property Mortgage Accommodation Bond Loan Maintain your freedom, feel secure and look forward to the future Provided by Reverse Mortgage Services Pty Ltd, a subsidiary of ABN AMRO Bank N.V.

2 Heading MAINTAIN YOUR FREEDOM, FEEL SECURE AND LOOK FORWARD TO THE FUTURE You ve worked hard to get to where you are today and your life is filled with many great memories. Wouldn t it be great to maintain your freedom, feel secure while doing so, and look forward to a future creating even more great memories? ABN AMRO offers you three financial solutions aimed at helping you to meet your needs during retirement and to maintain control of your life. 1. Reverse Mortgage The most highly awarded reverse mortgage in Australia, ABN AMRO s Reverse Mortgage is flexible, transparent and low cost, and allows you the financial flexibility to do the things you ve always wanted to do. Perhaps you want to renovate the house, take a trip, upgrade the car, or help your grandchildren with their school or university fees? If you re over 60 years of age, ABN AMRO s Reverse Mortgage allows you to access the equity you ve built up in your home to do exactly these kinds of things creating even more lasting memories into your future. It also keeps you in control of your finances. You can set up a regular monthly payment or a flexible drawdown facility to be used when, or if, you need it. There are no monthly fees for this facility and obviously no interest payable if you don t use it. This can reduce the worry and stress of any surprise bills. ABN AMRO is a member of SEQUAL, the Senior Australians Equity Release Association of Lenders. SEQUAL members are required to adhere to their Code of Conduct in the promotion and provision of equity release products. 1

3 2. Investment Property Mortgage If you ve made investments in property, wouldn t it be great to access some of that built up wealth, freeing up cash that will allow you to maintain your freedom and feel secure while doing so? If you re over 60 years of age, our highly flexible and transparent Investment Property Mortgage can make this possible. You have a choice of how long you borrow the money for. There is a choice of a 5 year or a 20 year term. Both terms also come with a no negative equity guarantee. This means that as long as you comply with the standard loan terms, then neither you nor your estate can owe more than the value of your property. Guaranteed. 3. Accommodation Bond Loan One of the hardest decisions to make is the decision to move from your home into residential aged care. The reasons for moving will vary from person to person. Perhaps you need specialist care, or just desire a little more companionship? Whatever the reason, the decision is not one to be taken lightly. In the past, the funding of an accommodation bond for aged care has been done through selling the family home, or relying on the support of family members. This can be a stressful and emotional experience. Often, you need to make a quick decision on the move into aged care and don t want the additional worry about what to do with the family home. Wouldn t it be great when faced with having to fund an accommodation bond, to be able to access some of the equity that you ve built up in your home over the years? It is your money after all. You could more easily meet your financial needs and still retain the family home. Alternatively you can use this loan to just give you some time to organise the sale of the home. This means you have the opportunity to make sure you get the best price you can for it. Accommodation bond funding can be very complex, which is why we insist that all customers get financial advice to make sure that you get the best outcome possible. If you do not have a financial adviser who specialises in this area then please contact us and we can identify a suitable independent representative for you. 2

4 ABN AMRO s Reverse Mortgage About reverse mortgages Reverse mortgages are an increasingly popular and practical way for people over 60 to finance their retirement. Essentially, a reverse mortgage is a loan. It allows you to borrow an amount of cash against the agreed value of your home. However, unlike other loans, you do not need to make any repayments during the life of the loan. While a normal bank loan is based on your income and your ability to make repayments, in the case of a reverse mortgage, it is the agreed value of your home that acts as the security for the amount you borrow. Interest on this loan is accrued monthly throughout the length of your loan. The loan is repaid when you either permanently move out of the home, move into ongoing aged care, or upon death. What ABN AMRO s Reverse Mortgage has to offer: Competitive Fixed and Variable Interest Rates No Monthly Fees or Charges No Maximum Limit. You have the opportunity to borrow an unlimited amount from a minimum of $20,000 upwards against the value of your home, dependent upon meeting our requirements The protection of both a No Negative Equity Guarantee and the option to protect up to 25% of the equity in your property for your heirs Maximum Flexibility in how you receive your loan. You can choose between lump sum, flexible draw and monthly income options. You can even choose to receive your loan using our blend of fixed and variable interest rates. Award-winning features that make ABN AMRO s Reverse Mortgage one-of-a-kind No monthly fees and charges Unlike many of our competitors in Australia today, our Reverse Mortgage has No Monthly Fees or Charges. That means you re not silently slugged every month. There is a settlement fee and a valuation fee, but then no account fees no duplicate statement fees, no revaluation fees, no drawdown fees. No hidden charges... and we mean it. Flexible You have the freedom to choose how much you want to borrow we have no maximum limit, subject to the assessed value of your home; your choice of fixed or variable interest rates; and how you choose to receive that amount. You can receive your loan as a lump sum, a monthly income or a flexible drawdown. We give you the flexibility to choose a combination that best suits your needs. 3

5 Reverse Mortgage Competitive rates Our interest rates are always very competitive. As you are aware, interest rates rise and fall over time. Your adviser will have a copy of our current interest rates for your information or please visit our website. Award winning Our Reverse Mortgage was recognised as the Best Variable Rate product and Best Fixed Rate product at the 2007 AFR Smart Investor Blue Ribbon Awards. It also won Money Magazine s 2008 and 2007 Best of the Best Reverse Mortgage and the Your Mortgage s 2008 and 2007 Best Reverse Mortgage. Best Variable Rate Best of the Best Reverse Mortgage bank Best Fixed Rate BEST reverse mortgage bank Reverse mortgage illustration It is important to draw the loan in an efficient way to minimise the interest costs over time. The illustration below is based upon house price growth of 3%, and assumes that the customer has taken out a loan at a fixed interest rate of 9%. Clearly, the compounding interest has significant impact over a long term, so be sure to only borrow the money you need. If you think you might need it in the future then you can set up a Flexible Drawdown Facility, which means that the money is there if you need it, but if you don t need it, it does not attract any interest charges and you have the option to make repayments if you wish. For an illustration of your own personal circumstances please talk to your adviser or use the calculator that can be downloaded from our website $900,000 $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ Value of Property Total Loan Repayment Total Equity Projected Projected Loan Term Age Property Value Balance Projected Equity 0 70 $400,000 $70,000 $330, $463,710 $109,598 $354, $537,567 $171,595 $365, $623,187 $268,663 $354, $722,444 $420,641 $301,804 4

6 Reverse Mortgage How much can you borrow? As with all reverse mortgages, the amount you can borrow is based on two key factors: the agreed value of the property, based on an independent valuation, and the age of the youngest borrower. The age of the youngest borrower is important as it governs the amount you can borrow against the value of your home this is called the Loan Value Ratio (LVR). ABN AMRO s Reverse Mortgage offers the following maximum LVRs: Age LVR Age LVR Age LVR Age LVR 60 10% 70 20% 80 35% 90 45% 61 11% 71 22% 81 36% 91 46% 62 12% 72 24% 82 37% 92 47% 63 13% 73 26% 83 38% 93 48% 64 14% 74 28% 84 39% 94 49% 65 15% 75 30% 85 40% % 66 16% 76 31% 86 41% 67 17% 77 32% 87 42% 68 18% 78 33% 88 43% 69 19% 79 34% 89 44% While our Reverse Mortgage has a minimum amount of $20,000 that you can borrow against the value of your home, we have no maximum limit. Any property worth over $1 million will be assessed on an individual basis, with slightly lower LVRs. Please refer to the calculator on the website to see how much you can borrow ( We understand that everyone s circumstances are slightly different, so please feel free to call us on to discuss your requirements. Key criteria that must be met You must be aged 60 or over. There is no maximum age limit. It does not matter if you are a pensioner, self-funded retiree or continue to work. You must own the property. You can have an existing mortgage, but it will need to be repaid out of the proceeds from ABN AMRO. You must still reside in the home. If you want to borrow against an investment property or holiday home, please call us to discuss, speak to your adviser, or for more information visit 5

7 ABN AMRO s Investment Property Mortgage About investment property mortgages An investment property mortgage is a loan. It allows you to borrow against the agreed value of an investment property or holiday home. However, unlike other loans, you do not need to make any repayments during the life of the loan. You do not lose ownership of your investment property, nor your right to rent the property out. While a normal bank loan is based on your income and your ability to make repayments, in the case of an Investment Property Mortgage, it is the agreed value of your investment property that acts as the security for the amount you borrow. Interest on this loan is accrued monthly throughout the term of your loan. The loan is then repaid at the end of the loan term, or when the property is sold. Features that make the ABN AMRO s Investment Property Mortgage one-of-a-kind Flexible You have the freedom to choose how much you want to borrow there is no maximum limit, subject to the assessed value of your property; your choice of fixed or variable interest rates; your choice of a 5 year or 20 year term; and your choice as to how you receive that amount. You can receive your loan as a lump sum, a monthly income or a flexible drawdown. And, ABN AMRO offers a choice between fixed and variable rates, What ABN AMRO s Investment Property Mortgage has to offer Competitive Fixed and Variable Interest Rates Options of either a 5 Year or 20 Year Loan Term No Monthly Fees or Charges No Maximum Limit. You have the opportunity to borrow an unlimited amount from a minimum of $20,000 upwards against the value of your investment property, dependent upon meeting our requirements The protection of both a No Negative Equity Guarantee and the option to protect up to 25% of the equity in your property for your heirs Maximum Flexibility in how you receive your loan. You can choose between lump sum, flexible draw and monthly income options. You can even choose to receive your loan using our blend of fixed and variable interest rates. depending on the structure of your loan. We give you the flexibility to choose a combination that best suits your needs. Competitive rates Our interest rates are very competitive. As you may be aware, interest rates rise and fall over time, so speak to your adviser, call us on or visit our website at to check the current rates. 6

8 Investment Property Mortgage Investment Property Mortgage illustration It is important to draw the loan in an efficient way to minimise the interest costs over time. The illustration below is based upon house price growth of 3%, and assumes that the customer has taken out a fixed interest rate of 9%. Clearly the impact of compounding interesting has significant impact over a long term, so be sure to only borrow the money you need. If you think you might need it in the future then you can set up a flexible drawdown facility, which means that the money is there if you need it, but if you don t, it does not attract any interest charges or fees and you have the option to make repayments if you wish. For an illustration of your own personal circumstances please talk to your adviser, use the calculator that can be downloaded from our website or call us on Year Term Illustration Value of Property Total Loan Repayment Total Equity $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ Value of Property Total Loan Repayment Total Equity Projected Projected Loan Term Age Property Value Balance Projected Equity 0 70 $400,000 $80,000 $320, $463,710 $125,254 $338, $537,567 $196,109 $341, $623,187 $307,043 $316, $722,444 $480,732 $241,712 7

9 Investment Property Mortgage How much can you borrow? The amount you can borrow is based on three factors: the agreed value of the investment property, the age of the youngest borrower and the term of the loan you select. If you select the 5 year term, ABN AMRO s Investment Property Mortgage is not dependent on your age. As long as the age of the youngest borrower is over 60, you can borrow up to 40% of the agreed value of your investment property. The agreed value of the property is based on an independent valuation. If you select the 20 year term, the age of the youngest borrower is important as it forms the basis for the maximum amount you can borrow against the value of your property this is called the Loan Value Ratio (LVR). ABN AMRO s Investment Property Mortgage with a 20 year term offers the following maximum LVRs: Age LVR Age LVR Age LVR Age LVR 60 10% 70 20% 80 35% 90 45% 61 11% 71 22% 81 36% 91 46% 62 12% 72 24% 82 37% 92 47% 63 13% 73 26% 83 38% 93 48% 64 14% 74 28% 84 39% 94 49% 65 15% 75 30% 85 40% % 66 16% 76 31% 86 41% 67 17% 77 32% 87 42% 68 18% 78 33% 88 43% 69 19% 79 34% 89 44% The Investment Property Mortgage has a minimum amount of $20,000 that you can borrow against the value of your home. There is no maximum limit. Key criteria that must be met You must be aged 60 or over. There is no maximum age limit. It does not matter if you are a pensioner, self-funded retiree or continue to work. You must own the property. You can have an existing mortgage, but it will need to be repaid. This can be paid out of the proceeds from this loan. 8

10 ABN AMRO s Accommodation Bond Loan About accommodation bond loans An accommodation bond loan is designed to cover the cost of moving into aged care. The three key features of the ABN AMRO product are: It is available to applicants over 60 Up to 40% of the value of your home can be borrowed The loan is available for a maximum term of 5 years. The reason that we have a relatively short term for the loan is to enable us to lend you the amount you need. If you need a smaller amount and want a longer term, then we have other solutions available. Please contact us on and our team can discuss the options available. Features that make ABN AMRO s Accommodation Bond Loan one-of-a-kind Not age dependent Unlike other similar products, ABN AMRO s Accommodation Bond Loan is not age dependent. As long as you are over 60 years of age you can borrow up to 40% of the agreed value of your home over the 5 year term. No ongoing monthly fees or charges Our Accommodation Bond Loan has no ongoing monthly fees or charges. That means you re not silently slugged every month. Flexibility You have the freedom to choose how much you want to borrow we have no maximum limit, subject to the assessed value of your home; your choice of fixed or variable interest rates; and how you choose to receive that amount. You can receive your loan as a lump sum, a monthly income or a flexible drawdown. And, we offer a choice between fixed and variable rates, depending on the structure of your loan. We give you the flexibility to choose a combination that best suits your needs. Competitive rates Our interest rates are very competitive. As you are aware, interest rates rise and fall over time. Your adviser will have a copy of our current interest rates for your information, or you can visit the website for the latest information. No negative equity guarantee Even though you can borrow up to 40% of the value of the property, you still receive a no negative equity guarantee. This means that whatever happens to interest rates or house prices the amount you owe on your loan can never exceed the value of the property as long as you comply with the loan s standard terms. You also have the option to protect up to 25% of the equity of your property in addition to this guarantee. 9

11 Accommodation Bond Loan Property Equity and Accommodation Bond Loan illustration The graph and table below are based on a 75 year old borrowing $160,000 (40% of the value of their house) and fixing the rate at 9% for 5 years. In addition it assumes that the value of the property will increase at a rate of 3% per year. For a personal illustration of your own situation please speak to your adviser or visit our website where there is a downloadable calculator. Or simply give us a call on The table shows that after 5 years in this example the amount of equity available in the property will have reduced to $213,201 from the original $240,000. $500,000 $450,000 $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ Value of Property Total Loan Repayment Total Equity Projected Projected Loan Term Age Property Value Repayment Projected Equity 0 75 $400,000 $160,000 $240, $463,710 $250,509 $213,201 Key criteria that must be met You must be aged 60 or over. There is no maximum age limit. You must own the property. You may be the sole owner or share ownership with your partner (some exceptions for trusts or companies). You must not still reside in the home. However, the house can be rented out and may have other occupiers living in it. If rented, there must be a formal lease in place that is no more than 12 months in duration and does not take the tenant over the expiry date of the 5 year term. The location of your home is also important. Check with your adviser or visit our website to see if your home sits within our standard postcode areas. If your home is not in our standard list then please give us a call and we can calculate the amount you can borrow. 10

12 Product comparison chart Reverse Mortgage Investment Property Mortgage Accommodation Bond Loan Getting started Minimum amount $20,000 $20,000 $20,000 Maximum amount No maximum for loans, subject to property valuation (variation on standard terms for properties over $1 million) No maximum for loans, subject to property valuation (variation on standard terms for properties over $1 million) No maximum for loans, subject to property valuation (variation on standard terms for properties over $1 million) Term The Term is the period up until the borrower ceases to reside in the property 5 Years or 20 Years 5 Years Loan Value Ratios (LVRs) See table on next page. See table on next page. For the 5 year loan maximum of 40% available for any age over 60 years Maximum of 40% available for any age over 60 years Property restrictions No retirement villages/resorts or transportable homes. Some postcode restrictions apply No retirement villages/resorts or transportable homes. Some postcode restrictions apply No retirement villages/resorts or transportable homes. Some postcode restrictions apply Negative equity guarantee Neither the borrower nor their estate will owe more than the value of the property unless the borrower breaches the loan terms Neither the borrower nor their estate will owe more than the value of the property unless the borrower breaches the loan terms Neither the borrower nor their estate will owe more than the value of the property unless the borrower breaches the loan terms Outstanding mortgage/ Existing mortgage To be fully repaid at drawdown To be fully repaid at drawdown To be fully repaid at drawdown Insurance requirements Current owners or strata replacement insurance policy Current owners replacement insurance policy and landlord s insurance if tenanted Current owners replacement insurance policy and landlord s insurance if tenanted Pensions impact Refer to Centrelink Refer to Centrelink Refer to Centrelink Your choices Lump sum Variable or fixed interest rate for 5, 10, 15, 20 years or Lifetime Variable or fixed interest rate for 5, 10, 15 or 20 years Variable or Fixed interest rate over 5 years Monthly income Variable interest rate. Payments can be spread over 5, 10, 15 or 20 years. Payments can be spread equally or increase 2.5% per year Variable interest rate. Payments can be spread over 5, 10, 15 or 20 years. Payments can be spread equally or increase 2.5% per year Variable interest rate. Payments can be spread over 5 years. Payments can be spread equally or increase 2.5% per year Flexible drawdown Agree a limit and just draw down when required. Borrowing is at our variable rate Agree a limit and just draw down when required. Borrowing is at our variable rate Agree a limit and just draw down when required. Borrowing is at our variable rate Protected equity You can protect up to 25% of the value of your home in addition to the no negative equity guarantee You can protect up to 25% of the value of your home in addition to the no negative equity guarantee You can protect up to 25% of the value of your home in addition to the no negative equity guarantee 11

13 Reverse Mortgage Investment Property Mortgage Accommodation Bond Loan The set-up fees All set up fees can be paid out of the loan proceeds rather than upfront Settlement fee $700 per application $700 per application $700 per application Valuation fee $300 for under $1 million $550 for properties over $1 million Request a quote for properties over $2 million $300 for under $1 million $550 for properties over $1 million Request a quote for properties over $2 million $300 for under $1 million $550 for properties over $1 million Request a quote for properties over $2 million Independent legal advice Costs borne by applicant Costs borne by applicant Costs borne by applicant Stamp duty When you have the loan Payable in some states depending upon the purpose of the loan Payable in some states depending upon the purpose of the loan Payable in some states depending upon the purpose of the loan Further drawdowns/ redraws Minimum of $1,000 (variable rate options only). No fee Minimum of $1,000 (variable rate options only). No fee Minimum of $1,000 (variable rate options only). No fee Monthly fees or charges None None None Repaying or changing the loan Repayments None required until borrowers cease to reside in the property None required until the end of the term, or upon death None required until the end of the term, or upon death Optional repayments Minimum of $1,000 (penalties may apply on fixed rate loans) Minimum of $1,000 (penalties may apply on fixed rate loans) Minimum of $1,000 (penalties may apply on fixed rate loans) Early repayment fee Years 1 to 5 is 1%* Years 1 to 3 is 1%** Years 1 to 3 is 1%** Discharge fee $250 $250 $250 Fixed rate break fees Charged at cost* Charged at cost* Charged at cost* Post-settlement variations $250 $250 $250 Maximum LVRs Age LVR Age LVR Age LVR Age LVR Age LVR Age LVR Age LVR 60 10% 65 15% 70 20% 75 30% 61 11% 66 16% 71 22% 76 31% 62 12% 67 17% 72 24% 77 32% 63 13% 68 18% 73 26% 78 33% 64 14% 69 19% 74 28% 79 34% 80 35% 85 40% 90 45% 81 36% 86 41% 91 46% 82 37% 87 42% 92 47% 83 38% 88 43% 93 48% 84 39% 89 44% 94 49% % *These fees are not payable in the event of death or move into aged care. ** This fee is payable in all circumstances if the loan is discharged within 3 years. Please note: Fees and charges are subject to change. Please refer to our website or call to check our current rates. 12

14 Answers to your questions You ll find a comprehensive list of frequently asked questions and their answers on our website at Below are the answers to the most frequently asked questions about our retirement solutions. GENERAL QUESTIONS 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 our retirement products have a No Negative Equity Guarantee, you can never owe more than the value of your home as long as you comply with the terms of the loan. What are your current interest rates? Visit to see our current rates. As you are aware, interest rates fluctuate but we are determined to keep our rates as competitive as possible. Your adviser will also have a copy of our current interest rates at the time of your application. You should make sure you consider all fees and charges to work out the real cost of the loan. About ABN AMRO In Australia, ABN AMRO was established in 1971 and is one of Australia s leading providers of integrated corporate and investment banking products and services, working with major corporations, financial institutions and public sector clients. ABN AMRO s Reverse Mortgage, Investment Property Mortgage and Accommodation Bond Loan are provided by Reverse Mortgage Services Pty Ltd (ABN ), a subsidiary of ABN AMRO Bank N.V. In late 2007, ABN AMRO Bank N.V., the ultimate parent company of ABN AMRO in Australia and New Zealand, was acquired by a consortium comprising of Royal Bank of Scotland (RBS), Fortis and Santander. As part of the consortium acquisition of the ABN AMRO Group, RBS is acquiring the global banking and markets operations of ABN AMRO, including the ABN AMRO Australia and New Zealand business. The RBS Group is one of the world s leading financial services companies providing a range of retail and corporate banking, financial markets, consumer finance, insurance, and wealth management services. The RBS Group operates in over 50 countries across Europe, the Americas, Asia and the Middle East serving more than 40 million customers and employing more than 170,000 people. The Group s brands include RBS, NatWest, Ulster Bank, Coutts, Citizens and many other household name financial services companies. Will my loan affect my children or 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 loan with your key 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 Reverse Mortgage? They may, which is why we urge you to talk directly to Centrelink, or your adviser, who will assist you accordingly. The flexible feature of our Reverse Mortgage may assist in minimising any impact though, so this is another good reason to talk to an adviser or Centrelink to structure your loan efficiently. QUESTIONS ABOUT THE REVERSE MORTGAGE How can I have a loan and not have to make any repayments in my lifetime what s the catch and will you be telling me how I can spend it? There is no catch. The principles of any reverse mortgage are that you are not required to make any repayments until you move out of the home on a permanent basis. Interest is accrued over the length of your loan and is then included in the final repayment amount. As for how you spend it, we leave that entirely up to you. What happens if I die or move into permanent aged care? 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 or your estate will 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. No break fees or early repayment fees apply in either of these events. Visit the ABN AMRO website at

15 What if my home is already mortgaged? The outstanding balance of your mortgage would be repaid by your Reverse Mortgage loan, leaving the surplus available to you. Can I repay my Reverse Mortgage loan at any time? Yes. However, Early Repayment Fees are applicable if you voluntarily repay the loan completely within 5 years and you may incur Break Fees if you voluntarily repay a fixed rate loan early. You can make partial repayments, but with a minimum of $1,000 each time. What do you mean by voluntary repayment? This means that if you decide to sell the property or refinance the loan, then there may be an early repayment fee payable. However, this fee does not apply in the event of death or a move into aged care. Why is the flexible drawdown option so popular? This enables you to set up a facility like an overdraft. It is there if you need it, but if you do not use it then there are no interest charges, and either way there are no monthly fees for the facility. So if you need some additional money then you can get it when you want without any hassle. You are in control. QUESTIONS ABOUT THE INVESTMENT PROPERTY MORTGAGE How can I have a loan and not have to make any repayments in my lifetime what s the catch and will you be telling me how I can spend it? There is no catch. The principle is that you are not required to make any repayments until the term of the loan is up. Interest is accrued over the length of your loan, but is included in the final repayment amount. As for how you spend it, we leave that entirely up to you. What happens if I die or move into permanent aged care? Will you want your money back straight away, like in a fire sale, and who is in charge of selling my property? The loans both have set terms (5 or 20 years), with no repayment required until the chosen term elapses. If you die within the term then repayment is required within either 12 months or the end of the term, whichever is the shorter period. It doesn t matter if you move into aged care. You stay in control. As long as the proceeds are sufficient to repay the loan, the sale is left entirely in your hands, 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. What if my property is already mortgaged? The outstanding balance of your mortgage would be repaid by your Investment Property Mortgage, leaving the surplus available to you. Can I repay my Investment Property Mortgage at any time? Yes. However, there is the potential for some fees to be incurred. If you discharge the loan within the first 3 years, then a fee of 1% of the initial loan balance is payable. If you have a fixed rate loan and repay more than 10%pa voluntarily within the 5 years then there may be break fees. Check with us and your adviser in either circumstance before making any repayments. Can I combine an Investment Property Mortgage with a Reverse Mortgage? Yes. We will assess each loan independently depending on the value of each property. See for details. QUESTIONS ABOUT THE ACCOMMODATION BOND LOAN 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 principle 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, and is included in the final repayment amount. 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 Loan, your estate will 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. 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. 14

16 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 the potential for some fees to be incurred. If you fully repay the loan with the first 3 years, then a fee of 1% of the initial loan balance is payable. If you have a fixed rate loan and repay more than 10%pa voluntarily within the 5 years then there may be break fees. Check with us and your adviser in either circumstance before making any repayments. 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 bond. 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 and we can explore the options available. Before you decide Before you make any decisions about applying for a loan, we ask you to do a whole lot of talking. Firstly, we suggest you talk things through thoroughly with your partner or relatives and read all our available information. It is equally important to discuss how you believe a loan will assist your life with your family members and any other beneficiaries. If your application for a loan is accepted, their inheritance may be affected and they may wish to assist you in your application process. We also require that you seek the independent, professional advice of a financial adviser. Your financial adviser will be able to weigh up the pros and cons of whether a loan to assist you in retirement is the right move for you and which options available are the most suitable. If you do not have a financial adviser, please contact us and we can help you locate one locally. You also need to consult your own solicitor or legal adviser. Again if you need help finding a suitable legal representative, please contact us. If you are on a pension, or receiving any government payments, you should check with Centrelink as to how taking out a loan could affect your payments. ABN AMRO also has a Customer Enquiries line, where our team of understanding and knowledgeable staff will answer any further questions you may have. Just call You can also visit our website for any further information. If you are considering a reverse mortgage, you may also wish to visit the Senior Australians Equity Release Association of Lenders website. SEQUAL is the self-regulatory body of the reverse mortgage industry, dedicated to the protection of borrowers and the promotion of responsible equity release lending options. The products promoted by SEQUAL members are required to adhere to the strict SEQUAL Code of Conduct. ABN AMRO is proud to offer a product that not only meets, but exceeds these requirements. 15

17 Please select one of these options Reverse Mortgage Investment Property Mortgage Accommodation Bond Loan LOAN APPLICATION FORM For each applicant Title: Mr Mrs Ms Miss Other: First name: Middle name: Surname: Gender: M F DOB: / / Marital status: Married Single Divorced Separated De Facto Widowed Address Line 1: Line 2: City/town: For each applicant Title: Mr Mrs Ms Miss Other: First name: Middle name: Surname: Gender: M F DOB: / / Marital status: Married Single Divorced Separated De Facto Widowed Address Line 1: Line 2: City/town: State: Postcode: State: Postcode: Phone: ( ) Phone: ( ) Mobile: Mobile: Postal Address (leave blank if same as above): Line 1: City/town: Postal Address (leave blank if same as above): Line 1: City/town: State: Postcode: State: Postcode: Are all applicants on title? Yes No Will the loan be signed under a Power of Attorney? Yes No Do you receive a Government pension? Yes No Have you discussed this loan with potential beneficiaries? Yes No Is any business activity undertaken at the property? Yes No Does anyone else reside in the property? Yes No How did you hear about ABN AMRO?

18 Security property details (leave address blank if same as previous page) Address: City/town: State: Postcode: Property title: (tick as appropriate): Freehold Strata Leasehold (lease must be greater than 50 years) Estimated value of property: $ What is the zoning (if known)? e.g. rural, residential etc Is the property over 10 acres (4 hectares) in size? Yes No If yes, how large? Is the property used for taxable purposes? Yes No Is any part of the property rented to others? Yes No Is there an existing mortgage or other encumbrance on the property? Yes No If yes, provide details: Amount owed? $ Will the property be leased? Yes No Term of lease (must be less than 12 months) DETAILS OF TENANTS (if applicable) Title: Mr Mrs Ms Miss Other: First name: Middle name: Surname: Gender: M F DOB: / / DETAILS OF TENANTS (if applicable) Title: Mr Mrs Ms Miss Other: First name: Middle name: Surname: Gender: M F DOB: / / How many tenants aged over 18 live in the property? (if more than two please attach an additional sheet listing the details above) Details of Lease AND LETTING AGENT (if applicable) Date lease signed: Name: Address: City/Town: State: Postcode: Contact Phone Number: Loan required (a combination of all options is allowed) Please see our website for loan calculators, or call us on if you have any questions. Amount Lump sum fixed rate: $ Lump sum variable rate: $ Flexible drawdown facility: $ Monthly income required: $ Term years or Lifetime years Protected equity option required? Y N If yes%? (Maximum 25%) Note: Accommodation Bond Loans have a maximum term of 5 years. Investment Property Mortgages have a term of 5 or 20 years.

19 Alternative contact (friend or relative in case we need to contact you)* Contact name: Relationship to you: Address: City/town: State: Postcode: Contact phone number: ( ) Contact fax number: ( ) * This contact should not live at the same address as you If there is any other information relevant to your particular situation, please detail below: Introducer Details Please complete the below with the appropriate information. If you do not have a representative in any of these categories, then please leave that section blank. ABN AMRO Contact Name: Mortgage Broker details Contact name: Firm: Address: City/town: State: Postcode: Contact phone number: ( ) Contact fax number: ( ) address: Introducer signature: Financial Adviser details Contact name: Firm: Address: City/town: State: Postcode: Contact phone number: Contact fax number: ( ) address:

20 Solicitor details Contact name: Firm: Address: City/town: State: Postcode: Contact phone number: ( ) Contact fax number: ( ) Privacy Act 1988 Consent Reverse Mortgage Services Pty Ltd (ABN ) ( The Manager ). Part of the ABN AMRO Group. The applicant/s acknowledge and consent to the Manager collecting the applicant/s personal information to: assess the applicant/s and provide this product and related services to them; monitor, audit, evaluate and otherwise administer this product and related services; comply with relevant laws including the Anti-Money Laundering and Counter Terrorism Financing Act 2006 (Cth); and keep the applicant informed of other ABN AMRO products and services. If the applicant would prefer not to receive information of this nature please tick this box. If the applicant does not provide all of the information required in this application form the Manager may not be able to process or accept this application. The applicant/s acknowledge that they have made an application for credit from the Manager. By signing below in Applicant Signature they agree that the Manager (and any other financier who at any time provides or has any interest in the credit) can do any of the following at any time: 1. Commercial or consumer credit information. Seek and use commercial or consumer credit information about them to assess an application for consumer credit or commercial credit. 2. Collection of overdue payments. Seek and use a credit report about them provided by a credit reporting agency to collect overdue payments from them. 3. Exchange of information between credit providers. Seek from and use or give to another credit provider (including any other credit provider who has lent money on the same security) any information about their credit worthiness, credit standing, credit history or credit capacity. In particular, the Manager may provide a reference on them. 4. Exchange information with advisers. Seek from and use to give to any broker, introducer, financial consultant, accountant, lawyer, Agent of the Manager or other adviser acting in connection with any financing provided or proposed to be provided to them any customer or commercial credit information. 5. Provide information for securitisation. Disclose any report or personal information about me/us to another person in connection with funding financial accommodation by means of an arrangement involving securitisation. They also understand and agree that the Manager may be paid and retain fees, margins and commission in respect of the credit arranged by the manager in consideration for its role as Mortgage Originator and Mortgage Manager. The manager may disclose your personal information to: related companies, located both in Australia and overseas jurisdictions, within the ABN AMRO group of companies when providing credit facilities; our agents, contractors or third party service providers including, but not limited to, mortgage insurers, mortgage managers, loan statement producers, ratings agencies, organisations involved in a transfer/sale of all or part of our assets or business and organisations that provide administrative and other support services to the Manager. Such agents, contractors and third party suppliers may be located both in Australia and/or overseas jurisdictions.; and where the disclosure is required by law, for example to government agencies and regulatory bodies as part of our statutory obligations, or for law enforcement purposes. On request the Manager will provide the applicant with a copy of personal information the Manager holds about them. The Manager will inform the Applicant beforehand if there is any charge associated with providing this information to them. Further information about ABN AMRO Group s Privacy Practices can be found by requesting a copy of ABN AMRO Group s Privacy Policy.