Commonwealth Bank of Australia
Online Access
Forgotten your
password?

Products

Interest In Advance

Back to Borrowing Options

Description

Interest in Advance enables customers to pre-pay interest 12 months in advance in order to gain tax benefits for a specific taxation period.

Interest in Advance loans are only available on interest only Fixed Rate Investment Home Loans.

 

 Benefits

  • Interest in Advance option is available to new and existing investment home loan customers.
  • Provides tax benefits for certain customers to allow a tax break on their interest sooner. Customer should consult with their accountant or financial adviser to determine if this product meets their taxation requirements.
  • As Interest only payments are made 12 months in advance, customer has the financial freedom without the burden of the monthly interest repayments.
  • Rate lock is available at the time of the application.
  • Customer receives up front discount of 0.20% off the applicable fixed rate.

 

Loan options

Interest in Advance is available on the following.

  • Fixed Rate Investment Home Loans with fixed rate periods of 1, 2, 3, 4 and 5 years 

 

Interest in Advance is NOT available on the following.

  • Fixed Rate Investment Home Loans with a fixed rate period of 7 years
  • Variable Rate Home Loans (including introductory rate loans)
  • Building or progressively drawn down loans (including release of transfer stamp duty prior to funding)

 

Eligibility

The standard Interest Only credit assessment applies with the additional requirement that customers hold sufficient funds to meet the initial Interest in Advance payment.

 

Interest in Advance Payment  

The customer must deposit the interest payable to a related account prior to

  • The Interest in Advance commencement date (settlement)
  • Subsequent yearly payments of Interest in Advance

 

Conditions

  • The Interest in Advance period must equal the Interest Only and Fixed Rate periods.
  • Payments option must be Interest Only.
  • Lenders Mortgage Insurance (LMI) is available.
  • Principal loan reductions are not allowed during the Interest in Advance period unless repaying the entire loan (in which case, early repayment fees are applicable).
  • If the customer fails to pay the Interest in Advance payment the loan is treated as if it is in default.
  • A Commonwealth Bank related account must be opened (if not already held) to enable the Bank to debit any fees and charges.

 

Interest Rates

A margin of 0.20% below the 1, 2, 3, 4 and 5 year fixed interest only interest rate is applicable whilst the interest is paid in advance.

 

A margin of 0.20% below the 1, 2, 3, 4 and 5 year  fixed interest only interest rate is applicable whilst the interest is paid in advance.              

Features

Introductory interest rates

Not Available

Interest Rate

Interest rate less 0.20% discount

Loan Purpose

Investment housing or personal investment

Top Up availability

Not available during Interest in Advance period

Minimum amount

$10,000

Minimum Term

12 months

Interest Structure Option

Interest in Advance Only

Repayment Frequency

The only payment option is annually 12 months in advance.

Additional Repayments

Partial repayments of any amount are not allowed

Special Payment permitted

Not allowed

Offset Account

Not available

Roll over 

Interest  in Advance is only available on Interest Only Fixed Rate Investment Home Loans; the interest in advance period must equal the interest only and fixed rate period.  

Repayment Redraw

Not available

Fees and charges

Refer current schedule of fees and charges