ANZ makes interest only concessions

A major bank has introduced a temporary COVID-19 assessment process which allows eligible customers to either move from principal and interest (P&I) to interest only (IO) or renew an IO period for 6 or 12 months.

ANZ introduced the measures, effective immediately, to aid customers looking to manage their cash flow without fully putting their repayments on hold.

To qualify, a customer cannot be requesting any additional lending and the loans in question must be at least 6 months old (for 6 months IO), and 12 months old (for 12 months IO), but must also be expiring within the next three months.

Other eligibility criteria includes:

• Any reduction in income must be temporary and due to COVID-19
• The customer must be employed and currently receiving income, including JobKeeper; where the loan has co-borrowers, at least one co-borrower must be employed and currently receiving income
• For customer relying on JobKeeper payments, brokers must document why they are not applying for the COVID-19 Assistance offering instead
• The customer must not be in arrears on any lending product
• Customers must not be on any COVID-19 Assistance offering at ANZ or elsewhere
• Lending involving LMI or guarantors are not acceptable
• Customers must be informed they may be eligible for the COVID-19 Assistance offering of a 6 month repayment holiday as an alternative to the IO renewal process, or else that they can make additional payments to their variable rate loan if they wish during the COVID-19 Assistance period

Brokers must complete the COVID-19 Interest Only Application to guage customer eligibility, as well as document the discussion with the borrower in question. ANZ also requires one payslip or bank statement, before subsequently using the customers’ existing ANZ account conduct and a credit bureau check to confirm eligibility.