Sovereign Options for financial assistance
Mortgage repayment deferrals
If a Sovereign Home Loans customer has been impacted by COVID-19 these are some of the financial support options immediately available to them on a case-by-case basis:
- The Mortgage Repayment Deferral (MRD)
- Interest Only (IO)
These options are available to all customers impacted by COVID-19. A 6 month period for either option is restricted to customers' whose income has been impacted by COVID-19. Customers can get 3 months of either option for other COVID-19 related reasons.
Loan terms are not being extended at the time of moving on to the MRD or IO; any loan term extension requests will be considered when loans are moved back to usual principal and interest payments.
Will this end up costing me more in the long term?
On all of these options you may pay more interest over the lifetime of your loan as the loan term is longer, you will be paying interest for longer or your loan has got larger due to the repayment deferral.
What about the LVR Restrictions?
There is no Loan to Value Ratio (LVR) restriction on eligibility and the MRD will not result in any charging or, where existing, any increase in Low Equity Margin (LEM). This means that if the MRD interest capitalisation increases a customer’s loan balance above 80% LVR we will not charge an LEM, or if the MRD increases the customer’s LVR that moves them into a new LEM band we will not increase the LEM.
Can I change between options as I go or get an extra extension if needed?
If you initially choose IO and then your circumstances change, you can request to be moved to the MRD. Also, you can chose to stop you IO or MRD period at any time, and revert back to paying principal and interest.
You can request an extension beyond the 3 or 6 month IO or MRD (these requests will be considered on a case by case basis).
How can you apply?
If you are interested in any of the options, feel free to reach out to the My Mortgage team and we'd be happy to discuss them with you and, if you are an existing My Mortgage client, we can submit your application on your behalf.
Alternatively, if you're not an existing My Mortgage client, you're welcome to touch base as well and we can let you know the requirements with Sovereign Home Loans and help get you in the best situation possible moving forward.