Reverse Mortgage - IMB Bank
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Plan for a more comfortable life after work, without having to sell your home

Life can be expensive when you’re no longer working. And while you do what you can to save money, now is the time you should be enjoying yourself.
An IMB Bank Reverse Mortgage can help you unlock the equity in your home and use this money to:

  • meet day-to-day living expenses
  • pay for ongoing home maintenance or renovations
  • travel
  • consolidate your debts and save interest fund a specific purchase like a car or caravan. 

How does our Reverse Mortgage work?

Our Reverse Mortgage is a type of home loan designed to allow homeowners – aged 70 years or older – to borrow money and use their home equity as security.

The borrowed money can be accessed as a lump sum payment, regular payments or a flexible cash draw facility. You can even request a combination of payment options. For example, you can take a portion as a lump sum, a portion as regular payments and the rest as flexible draw facility. And, you can change your arrangements at any time after your loan has settled; bearing in mind that should you decide, for example, to take more from your flexible draw, then you will need to reduce either the amount of your regular payments, or how long you want them to last.

To help you manage your finances, we’ll show you your available credit on your quarterly loan statement or you can check anytime through Internet Banking or by giving us a call. There are some restrictions around how the money can be spent, but it’s generally used to help fund a comfortable lifestyle in retirement.
 

An IMB Bank Reverse Mortgage allows you to use the equity in your home to fund your cost of living or one-off expenses – so you can keep living in the home you love.

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How is interest charged?

Interest is charged on the amount you borrow, but unlike most other loans, the borrower doesn’t have to make repayments. Instead, the interest is added to your loan balance and you will pay interest on interest, plus on any fees or charges added to your loan.

The effect of paying interest in this way, without making any or many repayments, is that the loan balance will increase over time. This will impact the value of the equity remaining in your property.

Why choose our Reverse Mortgage?

1. Payment flexibility

Set up an initial draw, monthly draw or flexible draw facility (or a combination of all three) – with the freedom to change your arrangement at any time.

2. Equity protection

Choose a protected equity option in addition to the no negative equity guarantee.

3. Competitive interest rates

Access competitive interest rates and pay no monthly loan account keeping fee.

 

Variable Interest Rate

Comparison Interest Rate

Application Fee

Reverse Mortgage

6.25% pa

6.29% pa

The comparison rate is based on a $150,000 secured loan for a term of twenty-five (25) years1.

495.00

(including valuation if security property value under $2m)

Can the loan exceed the value of the property?

Our reverse mortgages include a no-negative equity guarantee5, meaning the borrower or their Estate can’t owe more than the value4 of the secured property.

With an IMB Bank Reverse Mortgage, you can also choose a ‘protected equity’5 option, where you can protect up to 25% of the value4 of the secured property in addition to the no negative equity guarantee.

How is the loan repaid?

The loan must be repaid in full (including interest and fees) when the secured property is sold, or within 12 months of the last borrower passing away or nominated resident leaving the property.

Repayments can also be made during the life of the loan if the borrower chooses to, but are not required.

What else should I consider?

Before you take out an IMB Bank Reverse Mortgage, it’s important you read our Reverse Mortgage Information Statement. This contains more information about how reverse mortgages work, and the issues to consider in deciding if a reverse mortgage is right for you, such as:

  • How will the loan affect your future choices?
  • Will other people living in your home be affected?
  • Will you be able to leave your children an inheritance?
  • Are there alternatives more appropriate for you?
  • Will your pension change?

Do I need to get advice?

We require you to obtain independent legal advice and we highly recommend that you seek independent financial advice.

IMB Reverse Mortgage Product Summary
What are the interest rates? 6.25% pa
Variable Interest Rate
6.29% pa
Comparison Rate
The comparison rate is based on a $150,000 secured loan for a term of twenty-five (25) years1.
Minumum loan amount $20,000
Maximum loan amount $1,000,000
Minimum borrowing age 70
Maximum borrowing age N/A
How much can be borrowed? (Loan to Value Ratio) Refer to LVR tables
Interest rate Variable rate that can change at any time (please ask us for further details)
Fees and charges Please ask us for further details

Payment options:

  • Initial draw
  • Monthly draw
  • Flexible draw
  • A combination of the above
Payment options are flexible to help you manage your finances. You can change the amount of your payment options at any time after your loan has settled, but remember that any changes may affect the amount of credit available to you in the future. For example, if you access more from your flexible draw it will reduce the amount you can access as monthly draw. Note: we will not tell you when you access more than you requested from your flexible draw so you will need to track your available credit, which can be done easily using Internet Banking, on your quarterly statement or by giving us a call.
What is an acceptable purpose for a Reverse Mortgage? Any purpose permitted by IMB Lending Policy (e.g. living expenses, maintaining the home, travel, repayment of debts)
Can you refinance an existing mortgage? Yes
When does the loan need to be repaid? The loan will need to be repaid when the property is sold, or
within 12 months of the last borrower passing away or nominated resident leaving the property 
What can you use as security? You can use an owner occupied home or investment residential property as security, provided all borrowers are on title 
Can the secured property be rented? Yes
Can you make partial repayments on the loan? Yes
Can you redraw from the loan? Yes, a redraw is permitted if you have available funds to draw from the loan
Can you access your funds online?

Yes, you can view your account and make online transactions to an IMB account for a flexible draw facility or redraw3

Does the loan have a no negative equity5 guarantee? Yes, neither the borrower or their Estate can owe more
than the value4 of the secured property5  
Does the loan have a protected equity5 option?  Yes - in addition to the no negative equity guarantee you can
protect up to 25% of the value4 of the secured property (with a corresponding reduction in maximum LVR)5

How much can you borrow?

The maximum amount you can borrow is based on:

  • the agreed value of the secured property, and
  • the age of the youngest borrower.

The age of the youngest borrower dictates the maximum percentage of the secured property value that can be borrowed (i.e. the Loan to Value Ratio or LVR):

Age

LVR

Age

LVR

Age

LVR

Age

LVR

Age

LVR

70

18%

76

24%

82

33%

88

39%

94

44%

71

19%

77

26%

83

34%

89

40%

95

45%

72

20%

78

28%

84

35%

90

41%

96

46%

73

21%

79

30%

85

36%

91

41%

97

47%

74

22%

80

32%

86

37%

92

42%

98

48%

75

23%

81

32%

87

38%

93

43%

99

49%

 

 

 

 

 

 

 

 

100+

50%

Please note the maximum LVR reduces if you choose a protected equity option.

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Information correct as at May 2018 and subject to change without notice. Lending criteria, terms and conditions, fees and charges apply. For full details refer to IMB Bank’s Reverse Mortgage and Aged Care Loan Terms and Conditions available by contacting IMB. 1. The comparison rate is based on a $150,000 secured loan for a term of twenty-five (25) years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. 2. Only payable on settlement. Includes valuation if security property value is under $2m. If security property value is over $2m an additional valuation fee will apply. Other fees and charges may apply. 3. Internet Banking will not be available to the borrower if an attorney is acting for them – in these circumstances, Internet Banking will be available to the attorney but the attorney will not be able to draw any funds using Internet Banking. 4. As determined by an accredited valuer in accordance with the terms and conditions of the loan. 5. Provided the borrower is not in default under the terms and conditions of the loan.

Why choose IMB Bank?

Established in 1880, IMB has been helping people achieve their financial goals for 138 years. IMB offers a full range of banking solutions including home and personal lending, savings and transaction accounts, term deposits, business banking, financial planning and can arrange a wide range of insurance and travel products.

IMB has a growing branch network throughout the Illawarra, Sydney, NSW South Coast, the ACT and Melbourne. We have a lending specialist in every branch and a team of mobile lending specialists who will come to you. IMB members enjoy access to free automated phone and internet banking and a team of professionals who are just a phone call away at our locally based call centre.

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