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In correspondence seen by Broker Daily, Suncorp said repayments could rise for customers who had paid ahead on their principal and interest loans and held funds in cashback redraw.
The announcement follows the news that the originally Queensland-based bank would end new loan applications from 7 October, as it continued its integration into Australia and New Zealand Banking Group (ANZ), the acquisition of which was completed in July 2024.
The bank said: “If a customer has made advance payments, and has funds available in their cashback redraw, their minimum loan repayment at ANZ is likely to increase.
“This can reduce the total interest paid over the life of the loan but means the customer is likely to pay higher loan repayments.
“This increase could be significant depending on the loan balance, how much is paid in advance and the remaining loan term.”
Suncorp said brokers could access a minimum loan repayment calculator through its Move Hub to help customers understand the potential impact.
Suncorp confirmed, however, that interest rates applicable at the time of the move to ANZ would stay the same, although variable rates and any applied margin in the future would be subject to change, as per loan terms and conditions.
Offset accounts, construction loans among other changes
The transition will also bring changes to offset accounts, construction loans, and redraw facilities.
Only one offset account will be able to be linked to a home loan, with sub-accounts becoming ANZ transaction accounts that will no longer offset the mortgage.
Construction loans will be subject to a 24-month limit to complete construction from the date of the move to ANZ. During this period, loans will switch to interest-only repayments, and redraw will be unavailable. Loan terms may also be amended.
Home loans held in a company name will lose access to redraw, while loans with no outstanding balance will be closed unless customers take action.
For commercial term loans, payment dates and base rate reset dates must align. Where they differ at the time of the move, the base rate reset date will be aligned with the existing payment date.
Shane Davis, head of broker partnerships at Suncorp, said that for customers affected by the changes, the bank would get in touch.
“We’re asking customers to read the information they have been sent, consider their options, and discuss with their brokers,” he said.
Suncorp outlines broker commission arrangements
Eligible brokers will continue to receive trail commissions on existing Suncorp Bank customers after their loans move to ANZ, the bank has confirmed.
Suncorp also advised brokers to seek ANZ accreditation through their aggregator if they were not already accredited with the lender.
[Related: Brokerage fined for ‘exploitation of vulnerable workers’]
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