What's changing

The available redraw on your loan may reduce so that by the end of your agreed loan term, both your loan balance and the available redraw will be zero. Any adjustment made will occur on your monthly repayment date.

This ensures you pay off your loan within your contracted loan term, and also protects you against any unexpected increases in your minimum repayment.

The funds you have deposited into your loan will go toward paying off your loan principal.

How it works

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The rate at which your redraw balance will reduce is dependant on a number of factors and is different for every customer.

Cara takes out a $500,000 variable rate home loan with a loan term of 30 years. She makes principal and interest repayments on her loan. The graph shows how her home loan balance will decrease over time.

  1. In year 10 her loan balance is $408,000
  2. In year 25 her loan balance is $142,000

Let’s say Cara makes a $200,000 additional repayment toward her loan in year 10, and continues to pay the minimum repayment to pay off her loan in 30 years. Her minimum principal and interest repayment will reduce.

  1. In year 10 her loan balance will be $208,000, while her available redraw balance will be $200,000. This adds up to what her loan balance would have been if she had made no additional repayment ($408,000)
  2. In year 25 her loan balance would be $72,000, while her available redraw balance is $70,000. This adds up to what her loan balance would have been if she had made no additional repayment ($142,000). Other factors may affect your available redraw.1

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What it means for you

  • These changes apply if you have a Variable or Fixed Rate Principal and Interest Home Loan/Investment Home Loan or a Variable Rate Personal Loan
  • If you’re currently using a redraw facility to deposit money that you plan on using later, an offset account may better suit your needs

Please note that withdrawing from your available redraw may cause your repayment amounts to increase. This includes transfers to an offset account.

You can find out how much you have available for redraw at any time in NetBank and the CommBank app.

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For the purposes of the examples, all amounts have been rounded to the nearest dollar. Actual repayments may involve dollars and cents. Applications are subject to credit approval. Full terms and conditions will be included in our loan offer. Fees and charges are payable. As this advice has been prepared without considering your objectives, financial situation or needs, you should consider its appropriateness to your circumstances before acting on the advice. You should also read our Financial Services Guide.

1Please check your loan product terms and conditions for more information.