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Home  FAQs Frequently Asked Questions
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Frequently Asked Questions |
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A. An EQUITYtap is a reverse mortgage available to residential property owners over 60 living in their own home. And no repayments are required during the loan.
Q. How much equity can I release?A. The value of the equity that you can release depends upon your age and the value of your property. In general, the older you are the more we can advance you. The amount is between 15% and 45% of the value of your property. Click here find out how much equity you can tap into.
Q. Can I make repayments on the loan at any time?A. You are entitled to make voluntary repayments on the loan at any time. However, you are not required to make any repayments whilst you (or your spouse/partner) are still living in your home as all interest and fees are ‘rolled up’ into the loan balance.
Q. How will I receive the funds from the loan?A. You can choose to receive the funds either as a single lump sum after settlement or an initial amount at settlement with a series of monthly instalments or a combination of these options split over a 5 year or 10 year period from the date of settlement.
Q. Does the Lender own my property?A. No. Whilst the lender will take a first registered mortgage on your property, you will retain full ownership of the property.
Q. What happens to my home if I sell or move into long-term aged care or pass away?A. In the event of you both or the remaining Borrower moving into long-term aged care or passing away, we will work with you or your Executor to sell your property or arrange for the debt to be repaid from other assets, which would normally be within six months.
Q. What happens if my property is sold for less than the amount I owe?A. With our ‘No Negative Equity Guarantee’, provided the terms and conditions of the loan have been met, you or your estate will never owe more than the value of your property and we will not ask you to sell the property at any time.
Q. Can I stay in my home for as long as I want?A. With an EQUITYtap, provided the terms and conditions of the loan have been met, you can stay in your home for as long as you want.
Q. Can I apply for this loan if I still have a mortgage?A. You may apply for an EQUITYtap if you still have a mortgage secured on your home. However, you will be required to repay your existing mortgage in full from the proceeds of the EQUITYtap.
Q. Will I have to produce any proof of income to be assessed for an EQUITYtap?A. No, you will not be required to produce any bank statements or proof of income.
Q. Will my government income support be affected if I take out this loan?A. If you are receiving any Government Income Support, we strongly recommend you contact a Centrelink Financial Information Services (FIS) Officer to assess any impact an EQUITYtap may have on your entitlements. A FIS officer can be contacted on 13 23 00.
A. Unlike traditional loans and mortgages there is no fixed repayment date. The loan only becomes repayable when the earliest of the following occurs:
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You sell your home or investment property or
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You have both permanently vacated your home or moved into long-term aged care or
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You have both passed away.
Q. What happens if my property is sold for more than the amount I owe?
A. All money available after the sale of your property and the repayment of the loan naturally goes to you or your estate. The EQUITYtap loan balance, including interest, fees and costs are deducted from the sale proceeds.
Q. Can I ensure there will be an inheritance for my beneficiaries?
A. Through our ‘Protected Equity Option’ you can choose to protect a proportion of your property’s future value. That way, you have a guaranteed proportion of the sale proceeds set aside for you or your beneficiaries, no matter what the final loan balance is or subsequent movement in the value of your property.
Q. What happens if interest rates change?
A. If you select EQUITYtap -'Fixed for Life' you will have one interest rate guaranteed for life, so you can be absolutely certain of what your loan balance will be each year, irrespective of future interest rate movements that may occur.
If you select the EQUITYtap - 'Capped for Life', then your interest will be a variable interest rate that may change up and down in the future, but will never exceed the maximum 'Capped Rate'. With this structure you will be able to take advantage of any reductions in future interest rates whilst having protection should interest rates exceed the maximum 'Capped Rate'.
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Membership No. 406491
Membership of COSL and the use of the COSL Logo is not and is not to be taken as
an endoresment by COSL of the Member, its products, services, or financial position.
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Important News
Little Johnny was being questioned by the teacher during an arithmetic lesson. 'If you had ten dollars,' said the teacher, 'and I asked you for a loan of eight dollars, how much would you have left?'
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