Protection Provides Peace of Mind
05 April 2018
Not a lot of people are aware that reverse mortgages are arguably one of the most heavily regulated consumer finance product in Australia. These regulations, combined with additional safeguards that Heartland provides, along with thorough processes, are designed to ensure our customers make an informed decision and are well protected. The steps we take include:
Independent Legal Advice
Independent legal advice is mandatory. This ensures our customers are making the decision to take out a reverse mortgage freely, and in an informed manner.
Family discussion is a key part of the process in taking out a reverse mortgage. Whether to involve family is up to our individual customers’, however Heartland actively encourages it and requires customers to confirm that they have considered this as part of the application process.
To assist you in making an informed decision, ASIC have developed a calculator which assists to illustrate the amount of equity that will remain under different scenarios. Heartland provides this to all customers and anyone can go on to ASIC's Money Smart Reverse Mortgage Calculator (link available here) to complete a calculation, or one of our team can complete a tailored one for you.
Our promises are designed to provide customers with peace of mind to live a more comfortable retirement with independence and dignity. We make the following promises to our customers*:
- Lifetime Occupancy - your home will remain the place you live in for as long as you choose.
- No Negative Equity Guarantee - the amount required to repay the loan will never exceed the net sale proceeds of the property.
- Loan Repayment - there is no requirement to make any loan repayment until the end of the loan, however you are free to make payments at any time.
Heartland also offers customers the ability to protect a portion of their equity with our Equity Protection Option.
Independent Financial Advice
We recommend customers discuss their requirements and objectives with a financial adviser and in some cases make this mandatory. In addition, customers are encouraged to speak with Centrelink to ensure there is no impact on government entitlements.
Future Need Consideration
Another important aspect when deciding to take out a reverse mortgage is thinking about future needs. This includes ongoing living expenses, aged care costs, medical expenses and plans to leave funds in beneficiaries. As noted in a previous article, a big factor in these considerations is longevity risk - the risk of outliving financial resources.
Our 30 Day Cooling Off Period
If you take out a loan with us and have a change of heart, Heartland’s 30 day cooling off period allows you to cancel your reverse mortgage within 30 days of settlement and repay your loan at no additional cost.
Heartland will refund the Settlement Fee, interest and the standard cost of a valuation. The only costs you may incur are any government charges, and your independent legal advice on the loan agreement.
Our cooling off period is an addition to Heartland’s loan repayment promise, and the ability to repay the loan, in full or in part, at any time, with no penalty. Our new cooling off period is just a further demonstration of how Heartland takes its duty of care for our customers seriously.
Finally, bringing all this together is the duty of care Heartland has for our customers. We take our obligations and the trust customers have placed in us seriously, and because of this Heartland is 100% committed to the Banking and Finance Oath.
If you would like to discuss these protections further, or how a reverse mortgage could be used to help you, please don’t hesitate to contact our friendly team on 1300 889 338 or [email protected], or request an information pack.
* Subject to complying with the terms and conditions of the Heartland Reverse Mortgage, you will not owe more than the net sale proceeds of your home and you can keep your home for as long as you choose.
Information provided is accurate as at 1st October 2018 and may change from time to time.