MELBOURNE MORTGAGE FINANCE LENDING UPDATE – March 2025

Interest Rate Options

• 8.85% variable rate if no monthly interest-only payments are made

• 8.35% variable rate if half monthly interest-only payments are made

• 7.85% variable rate if full monthly interest-only payments are made

• interest is calculated on the drawn balance daily and posted to the account monthly

• if full interest-only payments are made, the loan balance will not exceed the drawn loan amount

Most Common Loan Purposes

• paying out existing mortgage debt and eliminating high repayments on that debt

• paying out credit card debt and reducing card limits

• establishing a Cash Reserve fund for future needs

• home renovations and repairs

• medical and travel

• funding access to aged care facilities

• commercial uses and new home construction are not permitted purposes

Maximum Loan Amounts

• minimum age is 60 …. maximum loan for borrower aged 60 is 20% of property value

• for each year over 60, the maximum loan amount increases by 1% ... for example at age 75, the maximum is 35%

• the older you are, the more you can borrow / at age 90+ the maximum loan is 50% of property value

• employment is not required / age pension is acceptable income

Acceptable Security Properties

• normal residences / holiday homes / investment properties

• security properties must be acceptable postcode areas (not isolated rural areas)

• maximum land size generally 10 hectares, but subject to location and lender approval

• retirement village units are not acceptable securities

Legal Advice

• it is a legal requirement that borrowers must obtain legal advice from their solicitor before signing loan contract

• solicitor will also attend to other matters including contract special conditions

• solicitor will return all documents to the lender in one package including title, Transfer of Land, evidence of insurance

Barry Le Brocq

Melbourne Mortgage Finance (Reverse Mortgage loan specialists)

Patterson Lakes

Mobile 0437417042

www.mmfinance.com.au

(Information is correct as at March 2025)

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