{"id":1709,"date":"2020-04-08T23:55:17","date_gmt":"2020-04-08T13:55:17","guid":{"rendered":"https:\/\/theonsitemanager.com.au\/news\/?p=1709"},"modified":"2020-04-07T12:02:28","modified_gmt":"2020-04-07T02:02:28","slug":"faqs-covid-19-crisis","status":"publish","type":"post","link":"https:\/\/theonsitemanager.com.au\/news\/faqs-covid-19-crisis\/","title":{"rendered":"FAQs Covid 19 Crisis"},"content":{"rendered":"\n<p><strong>I remember after the GFC I said something like, wow, now I\u2019ve seen everything.\u00a0\u00a0 Wrong!<\/strong><\/p>\n\n\n\n<p>We\nunderstand that these are challenging times.&nbsp;\nI use the term challenging because really scary and uncertain just\nsounds too confronting!<\/p>\n\n\n\n<p>Please\nknow that we are here for our clients and indeed anyone who needs us.&nbsp; Having said that the banks have indicated\nthat to expedite positive outcomes they are dealing directly with broker\nintroduced borrowers and that\u2019s fine.&nbsp; If\nyou need to us to support your case and liaise with your banker, we are\nhere.&nbsp; If you feel your bank is not\nstepping up please understand that they are not resourced for these\nunprecedented events and are doing their absolute best.&nbsp; I think it\u2019s fair to say that no bank has\nbuilt its staff, procedures and IT infrastructure on the basis of a worldwide\npandemic.<\/p>\n\n\n\n<p>Here\u2019s the\nlatest we have albeit new announcements and government policy are making most\ninformation general at best.<\/p>\n\n\n\n<p><strong>What\nassistance can I get from my bank?<\/strong><\/p>\n\n\n\n<ul><li>Generic in $3M to $5M existing debt\nrange<\/li><li>6 month deferred repayments 3 months +\na further 3 on review in some cases<\/li><li>Overdraft on a case by case basis<\/li><li>Equity access on a case by case basis<\/li><li>$5M to $10M borrowers by application<\/li><\/ul>\n\n\n\n<p>It is\nimportant to appreciate that until recently the definition of a small business\n(SME) included lending up to $3M. The matching of support packages to SME\u2019s has\nbeen a moving target as the government sought to find a more appropriate\ndefining debt level. The current level is now $10M albeit the banks are\napproaching borrowers in different ways depending on debt level.<\/p>\n\n\n\n<p><strong>How do I\napply?<\/strong><strong> <\/strong><\/p>\n\n\n\n<ul><li>Many banks will have already been in\ntouch proactively<\/li><li>CBA \u2013 automatic up to $5M for example.<\/li><li>Westpac \u2013 online or via relationship\nmanager<\/li><li>Suncorp \u2013 Relationship manager<\/li><li>ANZ \u2013 Relationship manager<\/li><li>Bank of Qld \u2013 relationship manager \u2013\nproactive<\/li><li>NAB \u2013 via relationship manager<\/li><li>Macquarie Bank \u2013 via relation manager<\/li><\/ul>\n\n\n\n<p><strong>How long\nwill it take?<\/strong><\/p>\n\n\n\n<ul><li>Depends on bank and demand.&nbsp; A fast-moving target. There are simply too\nmany requests in bank systems to be sure.&nbsp;\nWe commend the CBA for automating the process via an opt out system and\nencourage the banking industry to do likewise (within the confines of their IT\ncapabilities).<\/li><\/ul>\n\n\n\n<p><strong>Will my\npayments come out of my account while my application for assistance is in\nprocess?<\/strong><\/p>\n\n\n\n<ul><li>Depends on the bank.&nbsp; Some are cancelling loan repayment Direct\nDebits (DDs) as soon as a borrower applies.<\/li><\/ul>\n\n\n\n<p><strong>If I apply\nfor assistance and a DD bounces before my loan payment deferment is approved\nwill my bank put me into default?<\/strong><\/p>\n\n\n\n<ul><li>No.&nbsp;\nThe bank will backdate the assistance package and adjust your loan\naccordingly.<\/li><\/ul>\n\n\n\n<p><strong>Can I\nredraw advance payments?<\/strong><\/p>\n\n\n\n<ul><li>Depends on your loan terms and\nfeatures.<\/li><\/ul>\n\n\n\n<p><strong>Should I\nmove advance payments to a separate account?<\/strong><\/p>\n\n\n\n<p>The impact\non advance payments (also known as redraw facilities) as a result of loan\nrepayment deferrals and capitalising interest will have a variety of impacts\ndepending on your lender.&nbsp; We think there\nis some risk that as interest capitalises advance payment balances (and hence\nfunds that can be redrawn) will adjust down.&nbsp;\nIf you think you will need to rely on loan redraws to get through it may\nbe worth thinking about making those redraws now.&nbsp; Remember, the more you redraw the higher your\nloan balance and greater the impact of capitalising interest.<\/p>\n\n\n\n<p><strong>Will the\nbank still assist me with deferred repayments if I have advance payments?<\/strong><\/p>\n\n\n\n<p>Yes.&nbsp; The same assistance applies.<\/p>\n\n\n\n<p><strong>If my loan\npayment is put on hold how does capitalised interest work?<\/strong><\/p>\n\n\n\n<p>Interest\ncharges to the loan and , with no repayments being made, &nbsp;the loan balance rises each month. As such you\nare essentially paying interest on interest as the balance rises but for most\nborrowers the after-tax impact with be negligible. <\/p>\n\n\n\n<p><strong>What\nhappens to my loan term once the crisis is over?<\/strong><\/p>\n\n\n\n<p>In most\ncases the bank will extend the loan term by the period of the repayment holiday\nwhich should result in payments being in line with what was being paid before\nthe crisis.<\/p>\n\n\n\n<p><strong>What If I Am\nUnsure If I Will Need Assistance?<\/strong><\/p>\n\n\n\n<p>Our advice\nis to seriously consider taking any assistance on offer.&nbsp; The end game of the virus emergency is\nunclear and with the possible risk of delayed assistance processing times\nbetter to be safe than sorry.&nbsp; Cash flow\nis king!<\/p>\n\n\n\n<p><strong>Are new\nloans being approved?<\/strong><\/p>\n\n\n\n<p>Yes, but\nnot in any great volumes.&nbsp; Applicants\nwill need to demonstrate why the crisis is unlikely to impact them or borrow at\na level that considers any crisis downside.&nbsp;\nWe are open for business.<\/p>\n\n\n\n<p><strong>How are\nbanks instructing valuers?<\/strong><\/p>\n\n\n\n<p>Case by\ncase and obviously a moving target.&nbsp; Most\nvaluers are seeking 3 years figures plus a post crisis cash flow and are\nattempting to arrive at a likely post crisis value. &nbsp;We expect that for existing loan reviews and\nrollover arrangements lenders may choose to set aside or defer new valuations.<\/p>\n\n\n\n<p><strong>What\nhappens if my BC can\u2019t pay my managers salary?<\/strong><\/p>\n\n\n\n<p>With a\nlikely spike in unemployment and rent arrears it may be that some unit owners\nwill be unable to pay levies.&nbsp; In the\nhighly unlikely event that this results in the BC salary being unable to be\npaid BCs can borrow or access overdraft limits to ensure essential services\nsuch as caretaking are maintained.<\/p>\n\n\n\n<p><strong>Can I pause\nequipment lease and credit card payments?<\/strong><\/p>\n\n\n\n<p>Yes.&nbsp; Contact your lender.<\/p>\n\n\n\n<p><strong>What about\nmy housing or property investment loan?<\/strong><\/p>\n\n\n\n<p>Home loans\nand property investment loans to individuals are being treated similarly to\nbusiness loans.<\/p>\n\n\n\n<p><strong>What other\nassistance is available?<\/strong><\/p>\n\n\n\n<p>Federal\nGovernment Corona Virus SME Guarantee Scheme<\/p>\n\n\n\n<p>These\nloans will be provided by participating banks which will be the majors and\nregionals as we understand it. Kick off date is 1<sup>st<\/sup> April 2020. &nbsp;There are a couple of terms in the link below\nthat should be clearly understood.&nbsp;\nFirstly, the government is not guaranteeing you will get the loan. It is\nguaranteeing the loan to 50% of it\u2019s value to the lending bank.&nbsp; Secondly, the term repayment holiday does not\nmean interest free. The CBA web site via the link below under Resources has an\nexample of how the product will work including indicative interest rates.<\/p>\n\n\n\n<p>This link\nwill give you a summary of what\u2019s on offer.<\/p>\n\n\n\n<p><a href=\"https:\/\/treasury.gov.au\/sites\/default\/files\/2020-03\/Fact_sheet-Supporting_the_flow_of_credit_1.pdf\">https:\/\/treasury.gov.au\/sites\/default\/files\/2020-03\/Fact_sheet-Supporting_the_flow_of_credit_1.pdf<\/a><\/p>\n\n\n\n<p>The\nQld Rural and Industry Development Authority are offering maximum $250,000 jobs\nsupport loans. The loans are by application. See link below.&nbsp; We expect other states to follow.&nbsp; <\/p>\n\n\n\n<p>As noted in the <a href=\"https:\/\/eur03.safelinks.protection.outlook.com\/?url=http%3A%2F%2Fwww.qrida.qld.gov.au%2F__data%2Fassets%2Fpdf_file%2F0018%2F17541%2FGuidelines-COVID-19-Jobs-Support-Loans.pdf&amp;data=02%7C01%7C%7C0e80c222d19044522f4a08d7d473484f%7C84df9e7fe9f640afb435aaaaaaaaaaaa%7C1%7C0%7C637211463916726398&amp;sdata=ucrYF5GnU77oSgGK5GDE0wL3FsvJd11piuBmsaogdZ0%3D&amp;reserved=0\">guidelines\nhere<\/a>, to be eligible for a concessional loan applicants businesses must\nhave been established from 1 July 2017. <\/p>\n\n\n\n<p>A business may still be able to apply if they have purchased or\ntaken over a business that was operating from 1 July 2017. Applicants will need\nto supply the required financials. <\/p>\n\n\n\n<p>Please visit the\n<a href=\"https:\/\/eur03.safelinks.protection.outlook.com\/?url=http%3A%2F%2Fwww.qrida.qld.gov.au%2Fcurrent-programs%2Fcovid-19-business-support%2Fqueensland-covid19-jobs-support-scheme%2Ffrequently-asked-questions-covid-19-jobs-support-loans&amp;data=02%7C01%7C%7C0e80c222d19044522f4a08d7d473484f%7C84df9e7fe9f640afb435aaaaaaaaaaaa%7C1%7C0%7C637211463916736397&amp;sdata=Qg19bVwngWRnLsrp8pmvfItM1dhlfvS5j3cm0%2FcBU78%3D&amp;reserved=0\">FAQ\npage<\/a> to find out more. <\/p>\n\n\n\n<p>For other business support please contact:<\/p>\n\n\n\n<ul><li>Queensland\n     Government support: 13 QGOV (13 74 68)<\/li><li>Queensland\n     Small Business Hotline: 1300 654 687<\/li><li>Australian\n     Government support &#8211; <a href=\"https:\/\/eur03.safelinks.protection.outlook.com\/?url=http%3A%2F%2Fbusiness.gov.au%2F&amp;data=02%7C01%7C%7C0e80c222d19044522f4a08d7d473484f%7C84df9e7fe9f640afb435aaaaaaaaaaaa%7C1%7C0%7C637211463916746408&amp;sdata=%2BBI7Yhf%2F%2Bir7b5Bsv6U8%2BsVn6z7WgHDJ03S9rHhuILc%3D&amp;reserved=0\">Business.gov.au<\/a>\n     or call 13 28 46<\/li><\/ul>\n\n\n\n<p>The basics of the scheme are as\nfollows:<\/p>\n\n\n\n<ul><li>$500 million loan scheme<\/li><li>Maximum loan up to $250,000<\/li><li>No repayments or interest charged for\nthe first year<\/li><li>Plus two years interest only<\/li><li>10-year term of loan<\/li><li>Open until 25 September 2020 or until\nfunding is fully committed.<\/li><\/ul>\n\n\n\n<p><a href=\"http:\/\/www.qrida.qld.gov.au\/current-programs\/covid-19-business-support\/queensland-covid19-jobs-support-scheme\">http:\/\/www.qrida.qld.gov.au\/current-programs\/covid-19-business-support\/queensland-covid19-jobs-support-scheme<\/a><\/p>\n\n\n\n<p><strong>I\u2019m\nUnconditional on a Purchase Contract.&nbsp;\nWill my bank still settle?<\/strong><\/p>\n\n\n\n<p>In our\nexperience the answer is a definite yes. We are working closely with lenders to\nensure that unconditional buyers can perform under their contracts and not risk\nlosing deposits.&nbsp; We are also working with\nthe banks to ensure that new buyers can access the various support packages\navailable post settlement.<\/p>\n\n\n\n<p><strong>Cash Flow\nis King<\/strong><\/p>\n\n\n\n<p>Finally,\nstay in touch with your accountant.&nbsp;\nThere has never been a more important time to have cash flow reports\nright up to date and fully inclusive of all the government and bank measures\nthat may assist you to survive. Your advisors in law and accounting will be\nthere for you I am sure.<\/p>\n\n\n\n<p><strong>Resources<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/www.commbank.com.au\/latest\/coronavirus.html\">https:\/\/www.commbank.com.au\/latest\/coronavirus.html<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.westpac.com.au\/help\/disaster-relief\/coronavirus\/\">https:\/\/www.westpac.com.au\/help\/disaster-relief\/coronavirus\/<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.anz.com.au\/support\/covid-19\/\">https:\/\/www.anz.com.au\/support\/covid-19\/<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.nab.com.au\/personal\/customer-support\/covid19-help\">https:\/\/www.nab.com.au\/personal\/customer-support\/covid19-help<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.boq.com.au\/help-and-support\/assistance\">https:\/\/www.boq.com.au\/help-and-support\/assistance<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.suncorp.com.au\/banking\/covid19-information.html\">https:\/\/www.suncorp.com.au\/banking\/covid19-information.html<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.macquarie.com\/au\/en\/about\/news\/2020\/comprehensive-support-package-for-australians-dealing-with-coronavirus-covid-19-impacts.html\">https:\/\/www.macquarie.com\/au\/en\/about\/news\/2020\/comprehensive-support-package-for-australians-dealing-with-coronavirus-covid-19-impacts.html<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.health.gov.au\/news\/health-alerts\/novel-coronavirus-2019-ncov-health-alert\/coronavirus-covid-19-current-situation-and-case-numbershttps:\/\/www.qld.gov.au\/law\/laws-regulated-industries-and-accountability\/queensland-laws-and-regulations\/fair-trading-services-programs-and-resources\/fair-trading-latest-news\/disaster-assistance\/covid-19\">https:\/\/www.health.gov.au\/news\/health-alerts\/novel-coronavirus-2019-ncov-health-alert\/coronavirus-covid-19-current-situation-and-case-numbershttps:\/\/www.qld.gov.au\/law\/laws-regulated-industries-and-accountability\/queensland-laws-and-regulations\/fair-trading-services-programs-and-resources\/fair-trading-latest-news\/disaster-assistance\/covid-19<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>I remember after the GFC I said something like, wow, now I\u2019ve seen everything.\u00a0\u00a0 Wrong! We understand that these are challenging times.&nbsp; I use the term challenging because really scary and uncertain just sounds too confronting! Please know that we are here for our clients and indeed anyone who needs us.&nbsp; Having said that the banks have indicated that to expedite positive outcomes they are dealing directly with broker introduced borrowers and that\u2019s fine.&nbsp; If you need to us to support your case and liaise with your banker, we are here.&nbsp; If you feel your bank is not stepping up please understand that they are<a class=\"more-link\" href=\"https:\/\/theonsitemanager.com.au\/news\/faqs-covid-19-crisis\/\">Read More &rarr;<\/a><\/p>\n","protected":false},"author":1046,"featured_media":1710,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mbp_gutenberg_autopost":false},"categories":[3,2,4],"tags":[],"_links":{"self":[{"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/posts\/1709"}],"collection":[{"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/users\/1046"}],"replies":[{"embeddable":true,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/comments?post=1709"}],"version-history":[{"count":1,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/posts\/1709\/revisions"}],"predecessor-version":[{"id":1711,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/posts\/1709\/revisions\/1711"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/media\/1710"}],"wp:attachment":[{"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/media?parent=1709"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/categories?post=1709"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/theonsitemanager.com.au\/news\/wp-json\/wp\/v2\/tags?post=1709"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}