Processes
Amending Home Loan Repayments
Definition of home loan repayments
There are three definitions for 'repayments' recognised by the Bank:
- Contracted Monthly Repayment Amount (CRA) which represents the minimum monthly repayment amount agreed under the loan contract, based on the loan balance, interest rate and contracted loan term (CLT).
- Required Monthly Repayment Amount (RMRA) applies to monthly repayment frequencies only (includes Salary Credit regardless of frequency) and represents the sum of:
- CRA
- Loan Service Fee (LFS), if applicable
- Hollard Insurance Partners Limited premium, if being debited to the home loan.
- Minimum Repayment Amount Required for weekly & fortnightly direct debit payer is the sum of:
- CRA + LSF multiplied by 12 & divided by 52 for weekly or 26 for fortnightly. Rounded up to the next whole
- Hollard Insurance Partners Limited premium, if being debited to the home loan. (for weekly & fortnightly repayment frequency the premium is divided by 4 & 2 respectively)
- Direct Debit Repayment Amount (DDRA) which represents the repayment amount that a customer elects to pay by direct debit from their nominated account.
- For monthly repayment frequency this amount must be equal to or greater than the RMRA.
- For weekly & fortnightly repayment frequencies this amount must be equal to or greater than the Total Minimum Monthly Repayments due for direct debit payers
- Total Minimum Monthly Repayments due for direct debit payers is the sum of:
- CRA
- Loan Service Fee (LFS), if applicable
- Hollard Insurance Partners Limited premium, if being debited to the home loan.
- For Weekly or Fortnightly direct debit payers this is the ‘Minimum Repayment Amount Required' for the selected frequency multiplied by the number of repayments to be made by the Next Due Date. For example if the Minimum Repayment Amount Required for a weekly direct debit frequency is $231, in a 4 week month they will be required to pay $924 & in a 5 week month they will be required to pay $1,155
Requesting an amendment to home loan repayments
If you are requesting an amendment to an 'application in progress' then you will need to submit your amendment online. Refer to submitting amendments.
A request for an amendment to home loan repayments on an existing home loan can be made as follows:
| If your customer wants to | Then |
|---|---|
| Amend Direct Debit details i.e. account number, amount, frequency or due date | Your customer may forward instructions to us via:
Alternatively, you can complete a Direct Debit Request form and email it to thirdpartyservices@cba.com.au
The turnaround for processing the request is three business days, unless:
|
| Cancel Direct Debit Account for Interest Only loans | Advise customer to:
|
| Reduce Required Monthly Repayment Amount (RMRA) | Complete all relevant sections of the Miscellaneous Application form and fax to your respective Lending Services processing centre as detailed above. If approved, we will prepare a Letter of Variation for the borrower and guarantor (if applicable) to sign. |
| Increase Required Monthly Repayment Amount (RMRA)/Reduce Contract Loan Term (CLT) | Increases to RMRA should be rare and infrequent and only approved in exceptional circumstances. Majority of changes should be made to customers DDRA. If deemed necessary, please complete the Miscellaneous Application form, as detailed above. We will prepare a Letter of Variation for the borrower and guarantor (if applicable) to sign. |
You should note the following:
- All requests to amend the Required Monthly Repayment Amount (RMRA) received by Group Lending Services will require the customer (and guarantor) to receive a Letter of Variation (LOV) for signing to confirm the change.
- Once the LOV is signed by the customer and returned to Group Lending Services, the RMRA and/or CLT/CRA can be amended in accordance with the customer's instructions.
- Amendments to RMRA are not permitted in the following circumstances:
- Repayment type is 'Interest Only' or 'Interest in Advance'
- Loan type is fixed
- Any amendment that results in the CLT being extended beyond 30 years
- if guarantors consent is not provided
- Loans that are in arrears. If the borrower is experiencing financial hardship i.e. cannot meet their monthly loan repayment they are to be referred to the Financial Assist Team. Where the customer will contact the Financial Assist Team, ask them to inform the operator that they are a BROKER ORIGINATED CUSTOMER. Please refer to the Financial difficulties page for further information and contact options.