Interest may be charged if you choose to repay or restructure your fixed term home loan during your fixed rate period. Your prepayment interest is calculated
based on current interest rates, how long the loan has left within the fixed term period and whether the Bank will suffer a loss. The interest rate used for
the calculation is based on the closest current fixed rate term and remaining time left on your home loan.
Prepayment interest is not charged if you do not exceed the repayment threshold of $10,000 per calendar year.
For example: Your total loan was $100,000 on a fixed term of two years at 5% p.a. You choose to repay $50,000 on that loan after one year and five months (leaving seven months on your fixed term). Your current rate would be compared to the Bank’s current six month interest rate to determine the amount of repayment interest to be charged. If the current interest rate for a six month term was 4.5% p.a., the Bank would be making a loss. You would therefore be required to pay the difference (0.5%) on the $50,000. If the current six month interest rate was higher or you repaid $10,000 or less in a calendar year, you would not be required to pay prepayment interest.
See description for payment calculation