Macquarie home loans are different by design

Thanks for choosing to bank with Macquarie. At the home of good borrowers, we think about our home loans differently. We know that our customers have unique needs and that’s inspired us to raise the bar and to think differently when designing our home loan experiences.

That’s why at Macquarie we’ve created a home loan facility, which gives our customers more flexibility and functionality, within a single simple structure. This allows you to set up and manage multiple loan accounts in one place and have the flexibility to tailor your home loan to suit your needs.

This guide provides you with information you should consider when choosing and tailoring your Macquarie home loan facility during the application process, helping you make the right decisions from the outset.

What’s a home loan facility?

A Macquarie home loan facility provides you with a single borrowing limit for all your home lending needs. A facility has the flexibility to have multiple security properties1 (e.g. your home and/or an investment property), different loan purposes, rate types, and repayment types under a single facility.

We offer two facility options: the Offset Home Loan Facility and the Basic Home Loan Facility.

Within your facility, you have the option to set up multiple loan accounts. You can then tailor each loan account to meet your individual needs.

With a Macquarie home loan facility, you can:

  • link one or more acceptable security properties1 to your facility
  • make separate repayments for each loan account under your facility
  • receive separate loan repayment and interest statements for each loan account under your facility
  • transfer your borrowing limit between loan accounts within the same facility2.

In addition to the above, if you choose an Offset Home Loan Facility, you can

  • have offset accounts linked to your loan accounts
  • pay a single fee per facility – if you have multiple loan purposes (i.e. owner occupier and investment) you’ll only pay one fee as the loan accounts are part of the one facility.

See examples of how a Macquarie home loan facility works.

Step 1: Choose your home loan facility

Read the table below to help you decide which home loan facility is right for you.

Key differences between our home loan facilities

 Offset Home Loan FacilityBasic Home Loan Facility
Is this right for you?

Suitable for customers who want a home loan with the ability to open offset transaction accounts, which can reduce their monthly interest charges. You will also pay an ongoing fee.

Suitable for customers who want a home loan with no ongoing fee and do not require offset accounts.

Offset accounts

Up to 10 offset accounts per variable rate loan account3

No

Access to Debit Mastercard®/s

Yes
(with offset account)

No

Multiple loan accounts

Unlimited loan accounts4

Up to six loan accounts

Variable rate options

Yes

Yes

Fixed rate options

Yes5

(You must have at least one variable rate loan account with a minimum limit of $20,000)  

Yes

Access to Macquarie credit card6

Yes7

(Annual Primary cardholder fee waived on Macquarie Black or Platinum Card)

Yes

Annual facility fee

$2488

(Offset Home Loan Facility fee)8

$0

Step 2: Tailor your home loan facility

If you require multiple loan purposes, rate or repayment types, you can tailor your home loan facility with more than one loan account.

For each loan account you’ll need to tell us:

What's your loan purpose?

For each loan account you’ll need to tell us how you plan to use your funds. You can choose owner occupied, investment or personal use.

How you can use your borrowing limit 

 Purpose
Owner occupied

If you plan to purchase, build/renovate or refinance a residential property you intend to live in.

Investment

If you plan to purchase, build/renovate or refinance a residential property for investment.

Personal use

If you plan to use your funds for other purposes, including travelling, purchasing a car or household goods, refinancing personal investments, investing in shares or accessing equity in your residential property.

What's your home loan rate type?

For each loan account you’ll need to consider if a variable or fixed rate type is right for you.
 

Key differences between variable and fixed rates

 Variable rateFixed rate
Is this right for you?

Suitable for customers who want to benefit from potential future decreases in interest rates and have the option to make unlimited additional repayments on the loan account – understanding that rates can go up as well as down.

Suitable for customers who want certainty of repayment amounts during the fixed term and accept that you won’t benefit from subsequent market interest rate reductions during the fixed rate period. You cannot have a linked offset account or redraw on the loan account. Break costs are payable should you wish to make changes to the loan account or make additional repayments.

Interest rates and monthly repayment amounts

May go up or down over the life of the loan

Will not change during the fixed rate period (1 – 5 years)9

Link offset account(s)

Yes

(Up to 10 per variable rate loan account)3

No

Additional repayments

Unlimited

Up to $10,000 per year10

Redraw11

Yes

No

When break costs may be payable by you12

N/A

  • Switching your loan account to a variable rate
  • Making additional repayments more than $10,000 in a year10
  • Changing your loan account repayment type
  • Changing your land loan to construction loan
  • Refinancing your loan
  • Repaying your loan account partially or in full

What's your home loan repayment type?

For each loan account you’ll need to consider if a principal and interest or interest only repayment type is right for you.
 

Key differences between home loan repayment types

 Principal and interest (P&I)Interest only (IO)13
Is this right for you?

Suitable for customers who want to make repayments that reduce their outstanding balance for the loan account.

Suitable for customers who want to make interest only payments during the interest only term14 and accept more interest will be paid over the life of the loan.

Repayments

Higher repayments as you’ll be paying both your principal and interest.

Lower repayments during interest only term as the principal won’t be reduced, but higher P&I repayments after the interest only term ends.14

Interest rate

Generally lower than IO interest rates.

Generally higher than P&I interest rates.

Total Interest paid

Lower interest paid over the life of the loan compared to IO.

Higher interest paid over the life of the loan compared to P&I.

Step 3: Set up your offset accounts

If you’ve chosen an Offset Home Loan Facility, you can open up to 10 offset accounts3 that can be linked to each of your variable rate loan account(s) to reduce the amount of interest charged.

How do offset accounts work with your home loan?

 Features
Interest offset on loan

For the purposes of calculating interest on your loan account, the balance of your offset account will be deducted from the balance of your linked loan account. Learn more about how offset accounts work.

Debit card

Access to offset account/s with Debit Mastercard®/s

Multiple offset accounts

Up to 10 offset accounts can be linked to your variable rate loan account.3

 Considerations
Rate type

Only available on loan accounts with variable rate type

Linking loan account

An Offset account can only be linked to one variable rate loan account at a time. You will need to tell us which variable rate loan account you wish to link your Offset account to.

Excess offset funds consideration

Offset balances higher than the linked loan account balance won’t be paid interest or offset any other loan accounts under your facility.

Repayments

Your monthly repayment amount remains the same and more of the repayment amount will go towards repaying the principal loan amount, which can help you pay off your loan faster. These funds will not become available for redraw.

Example 1: Tailoring your Offset Home Loan Facility

Alex and Leigh are refinancing their $800,000 owner-occupied home loan to Macquarie.

Alex and Leigh want...They decide to...

to use their joint savings to offset interest charged on their home loan.

apply for an Offset Home Loan Facility with a borrowing limit of $800,000.

  • to have a mix of variable and fixed interest rates, so they can take advantage of the different features of both rate types
  • to pay down their principal loan amount over time.

tailor their home loan facility by spreading their borrowing limit equally across two loan accounts – one variable and one on a 2-year fixed rate – both on principal and interest repayments.

to open multiple offset accounts to make it easier to keep track of their savings and spending money.

open three offset accounts, all linked to their variable rate home loan account:

  • a joint account for saving towards home renovations
  • a single account in Alex’s name for holiday savings
  • a single account in Leigh’s name for everyday spending.

Example 2: Tailoring your Basic Home Loan Facility

Mai is purchasing a home to live in and needs to borrow $1,000,000.

Mai wants...She decides to...

no ongoing fees and doesn’t need an offset account as she’s putting most of her savings towards her home purchase.

apply for a Basic Home Loan Facility with a borrowing limit of $1,000,000.

  • the ability to make regular additional repayments on 20% of her loan, with the flexibility to withdraw any additional payments for unexpected expenses
  • to fix 80% of her loan so she won’t have to worry about interest rate changes for the next five years
  • to pay down her principal loan amount over time.

tailor her home loan facility by setting up two loan accounts:

  1. $200,000 loan account on a variable rate and principal and interest repayments, with flexible repayments and redraw options
  2. $800,000 loan account on a 5-year fixed rate and principal and interest repayments.

Example 3: Tailoring your home loan facility for a combination of loan purposes

Emily and Phil are refinancing their owner-occupied home loan and an investment home loan, totalling $2,000,000 in borrowings.

Emily and Phil want...They decide to...

to use their joint savings to offset interest on a portion of their owner-occupied debt.

apply for an Offset Home Loan Facility with a borrowing limit of $2,000,000.

separate loan accounts for their owner-occupied and investment debt, so they can track interest charges on separate loan account statements.

For their owner-occupied debt:

  • to have the majority of their owner-occupied debt on a variable interest rate, so they can link an offset account and make additional repayments on their loan
  • to fix the remaining portion of their owner-occupied debt, so they don’t have to worry about interest rate changes for the next three years
  • to pay down their principal loan amount over time.

For their investment debt:

  • the ability to sell their investment property and repay their investment loan without incurring any early repayment costs
  • to make interest only repayments on their investment property for the first five years to reduce the impact on their cash flow.

tailor their home loan facility by setting up three loan accounts:

For their owner-occupied debt:

  1. $900,000 loan account on a variable rate and principal and interest repayments, linked to their offset account
  2. $300,000 loan account on 3-year fixed rate with principal and interest repayments

For their investment debt:

  1. $800,000 loan account on a variable rate with 5 years interest only repayments.

Example 4: Tailoring two home loan facilities with different ownership

Amal and Roshni want to refinance their owner-occupied home loans ($800,000) and investment home loan ($900,000) to Macquarie.

Amal and Roshni want...They decide to...
  • their owner-occupied debt to be in joint names
  • their investment debt in Amal’s name only
  • no offset accounts as they’ve put most of their savings towards their property purchases.

apply for two separate Basic Home Loan Facilities:

  1. one facility in joint names to refinance their owner-occupied home loan with a borrowing limit of $800,000
  2. one facility in Amal’s name to refinance their investment home loan with a borrowing limit of $900,000.

For their owner-occupied debt:

  • to take advantage of both the variable and fixed rate type features on their joint home loan facility
  • to pay down their principal loan amount over time.

For their investment debt:

  • to make interest only repayments on their investment property for the first five years to reduce the impact on their cash flow.

For their joint home loan facility:

  • tailor their joint Basic Home Loan Facility by spreading their borrowing limit equally across two loan accounts:
  1. a $400,000 variable rate home loan account on principal and interest repayments
  2. a $400,000 3-year fixed rate home loan account on principal and interest repayments.

For Amal’s home loan facility:

  • tailor Amal’s Basic Home Loan Facility for their investment debt by setting up a single variable rate loan account with 5 years interest only repayments.

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    Additional information

    This information has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502. This information does not take into account your financial situation or needs - consider what’s right for you.
     

    1

    Security property must meet the bank’s acceptable security requirements and is subject to credit assessment and approval.

    2

    Limit transfer cannot be completed if the new limit of the loan account you want to reduce would be less than the balance of that loan account after the transfer or if the loan account you want to transfer into is fixed rate type. Transferring the limit into an interest only repayment loan account is subject to credit assessment and approval. All limit transfer requests are subject to approval. 

    3

    Open and link up to 10 offset accounts per variable rate loan account for single or joint borrowers (up to 4 offset accounts per variable rate loan account can be requested at application stage). Company and trust borrowers can open up to 4 offset accounts which must be opened at application.

    4

    Up to 6 loan accounts can be opened during the application, however, unlimited new loan accounts can be opened post-settlement. Requests to change facility limit post-settlement are subject to approval.

    5

    An offset home loan facility cannot be fully fixed and offset accounts cannot be linked to fixed rate loan accounts. For an offset home loan facility, the variable rate loan account must have a minimum limit of $20,000.

    6

    Approval is subject to Macquarie credit criteria and suitability assessment. Terms and conditions apply and are available upon request. Fees and charges apply. 

    7

    Terms and conditions apply and are available upon request. Fees and charges apply. Annual Primary Cardholder Fee is waived for the Macquarie Black Card and Macquarie Platinum Card for the period you hold this facility with us.

    8

    The terms Offset Home Loan Facility fee and package fee are used interchangeably in our collateral and refer to the same fee.

    9

    Reverts to variable rate at the end of the fixed term.

    10

    Additional repayments of up to $10,000 can be made on a fixed rate account each year without penalty (additional payments above this amount may incur break costs). The 12-month period is calculated from the date the fixed term commenced. When your account has reverted to a variable rate at the end of a fixed term (1) you can make further additional repayments without incurring break costs and (2) any additional repayments made during the fixed term become available for redraw (subject to our terms and conditions).

    11

    With investment purpose, there may be tax implications when choosing between using a redraw and offset account.

    12

    Fixed rate loans may be subject to significant break costs. Please refer to the loan contracts for terms and conditions regarding break costs. At the end of the fixed rate period, the interest rate will revert to the discount variable rate applicable at that time.

    13

    Reverts to principal and interest repayments at the end of the interest only term. Interest only is not available within the last 20 years of a loan term.

    14

    Repayments required to pay out the loan will increase after the interest only term ends to cover both principal and interest. Interest only repayments may vary each month depending on the balance of your loan account, offset balance, variable rate and days in month. 

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    Unless stated otherwise, this information is provided by Macquarie Bank Limited AFSL and Australian Credit Licence 237502 (MBL) and does not take into account your objectives, financial situation or needs. You should consider whether it is appropriate for you. Finance is subject to our credit approval criteria. Terms and conditions apply and may change without notice.

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    Other than MBL, none of the Macquarie Group entities referred to are authorised deposit-taking institutions for the purposes of the Banking Act 1959 (Cth), unless noted otherwise. Their obligations do not represent deposits or other liabilities of MBL. Unless otherwise stated, MBL does not guarantee or otherwise provide assurance in respect of the obligations of that entity.

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