The Tailored feature on a home loan would use the formula in your letter of advice to automatically increase your repayments on the anniversary of your home loan if certain circumstances were met.
You could accept or decline these potential increases (assuming you were still meeting the minimum repayment requirements) and potentially pay your home loan off faster.
What’s changed with my Tailored home loan?
Effective from 30 April 2025, the Tailored feature has been removed from your home loan. You have been sent a letter explaining these changes, along with changes to your letter of advice.
You have also been sent a home loan summary, showing the updated payment details of your home loan.
The letter you received, dated 17 February 2025, will have also advised you that all your home loans (including ones without the Tailored feature) would move onto our June 2024 Home Loan Facility Master Agreement on 30 April 2025.
Why has my regular repayment increased?
The letter you’ve received with this FAQ sets out what your minimum payment will be from 30 April 2025.
One possible reason your regular repayment may have increased is that your minimum payment would have increased anyway on the next anniversary of your home loan.
Your minimum payment may have also changed, as without the Tailored feature, your principal and interest payments are now calculated differently. There is no longer the assumption that you’ll agree to automatic annual increases to your home loan repayments every year. If your minimum payment has changed, it’s to make sure your loan is paid off by the end of its term.
What is my expected end date and why has it changed?
Based on the details of your home loan and certain assumptions, such as your current interest rate and repayment amounts, your expected end date is when your home loan is expected to be paid off in full. You can find your expected end date in the home loan summary included with the letter you’ve received. Your expected end date may change from time to time but can never go beyond the last day of the term of your home loan.
It may have changed for the following reasons:
- Under the Tailored feature, it was assumed you would accept automatic payment increases on each anniversary of your home loan.
- Your principal and interest payments are calculated differently when you don’t have the Tailored feature.
- Your payment schedule option under your agreement is ‘keeping your minimum payments the same’. This generally means that your minimum payments stay the same wherever possible, but your expected end date will change from time to time. You can read more about this in clause 14.3 of the Home Loan Facility Master Agreement.
If you choose to increase your repayments each year by a similar amount to any automatic increases that took place with Tailored, then your expected end date may be similar to when you had Tailored.
Why are my loans being moved to the June 2024 Facility Master Agreement (agreement)?
The 17 June 2024 version of the agreement removes the Tailored home loan section from the end of clause 14, as well as removing references to Tailored home loans at the end of clauses 9.3 and 14.7
Other changes in the 17 June 2024 version of the agreement include the removal of wording related to:
- BNZ Advantage in clause 15.
- Flybuys in clause 16.
Will my ability to offset my TotalMoney home loan change because of the removal of the Tailored feature?
No, the removal of the Tailored feature won’t affect your ability to offset your TotalMoney home loan.
Do I need to sign anything?
No, you won’t need to sign anything. We’ve automatically made all the changes to your home loan.
When will my loan now re-amortise?
When your home loan had the Tailored feature, it would only re-amortise on its anniversary date, so once every 12 months.
With Tailored removed, your home loan will now re-amortise whenever a change is made, like:
- Refixing on a different interest rate.
- Increasing or decreasing repayment amounts.
- Changing the frequency of your repayments.
- Making additional lump sum repayments.
- BNZ agrees with you to interest-only repayments for a period.