The option to gradually increase your repayments and save.
- Pay off your loan faster and save thousands in interest1
- Change your payments to suit your changing lifestyle
- You’re in control - accept or decline each annual payment increase
Chances are, over the years, your income will increase or your expenses will reduce. By choosing our tailored repayments1 option you’ll get a gentle reminder each year to think about increasing your loan repayments. Keeping your repayments as high as you can afford can make a big difference to the total cost of your loan. The tailored repayments option is available with any BNZ home loan except our revolving home loans - Rapid Repay and Mortgage One.
Cut the cost of your loan
For example, by choosing fortnightly repayments of $250 rather than monthly repayments of $500, you’ll make two extra repayments a year and repay an extra $500 off your loan. That’s because there are 12 months in a year but 26 (not 24) fortnights. If you also accept small increases in your repayments each year, you can pay off your home loan even faster. This combination can give you surprisingly large savings in interest every year that could add up to tens of thousands of dollars over the life of your loan.
Flexibility and control
If your situation changes, the tailored repayments option allows you to change your repayments to better suit your budget and lifestyle. It’s nice to know that whatever happens, you’re still in control.
Budgeting is easy – your repayments won’t change during the year
Even if interest rates change you can rely on your home loan repayments staying the same during each year. For example, if rates go up, you’ll pay more interest but less off your loan. If rates go down, you’ll pay less interest but more off your loan.
An automatic reminder to get mortgage-free faster
If your goal is to repay your home loan as fast as you can, the tailored repayments option will help keep you on track. Each year, on the anniversary of the date you first drew down your loan, you’ll be given the option to accept a small increase in your repayments. You can choose to accept the increase or keep your repayments the same. It’s up to you.
An example of how it can work
The table and graph below are indicative only, but they show how the tailored repayments option can make it possible for you to be debt free years faster so you’ll be better off.
|Table2 loan without tailored repayments option||Loan with tailored repayments option|
|Interest rate||8.00% p.a.||8.00% p.a.|
|Loan term||25 years||15 years 1 month|
|Total interest paid||$131,453.11||$74,658.95|
|Time saved||-||9 years 11 months|
- Lending criteria, establishment or re-documentation fees apply. A Low Equity or Low Doc Interest Rate Premium may apply. Not available for business purposes or packaged offers.
- 'Table' loan means that the loan is divided into equal regular repayments which are a mixture of principal and interest. At the beginning of the loan, most of the repayment goes towards interest costs, with a small amount of principal repaid. Over time, as the principal is reduced, a larger portion of each repayment goes towards principal as the interest cost reduces.