Frequently asked questions
Take a look at the most commonly
asked questions. We’ll help you get the answers you need.
Midkey is Australia's first No Monthly Payments Loan provider for people in their mid-life, empowering the owners of residential real estate to unlock a portion of the equity in their home. Midkey was established in 2021 by Richard Young and Scott Collison, who discovered that many of their friends were increasingly unable to qualify with banks for required loans, despite having significant home equity. They believed they had a new and innovative solution to this problem that worked within Australia’s regulated lending requirements.
Click here to learn more about our founders.
No. Midkey is not a bank. We specialise in Midkey No Monthly Payments Loan for homeowners and would-be homeowners. We don’t offer bank accounts, credit cards, or other products that banks typically do.
The main differences are:
- Timing of payments: Traditional home loans require principal and interest payments monthly. Midkey loans have no regular monthly payments; all principal and interest can be repaid at the end of the loan.
- Assessment flexibility: Traditional lenders assess your ability to make regular loan repayments by reviewing your income, expenses, and assets. While Midkey considers similar factors for any of your priority debts, we don’t require you to prove your ability to make regular or monthly repayments on our loans.
- Unlocking home equity: Due to our assessment flexibility, even if you don’t meet traditional serviceability criteria, you may still qualify for a Midkey loan and unlock your usable home equity to increase your borrowing capacity.
- Reduce your monthly debt payments: If you want to reduce your monthly debt payments, you can use a Midkey loan to decrease the amount of your traditional home loan.
- Simple interest: A Midkey loan charges simple interest (not compound interest). Simple interest means that interest is calculated only on the original loan amount, not on accumulated interest. Our simple interest rate is roughly 1% to 2% higher than a traditional home loan.
- Repayment date: A traditional home loan typically specifies a date by which you must repay your loan, whereas a Midkey loan is only repayable on certain events, like if you sell your home, you decide you want to repay, move into aged care, or you die.
- Innovative fee: The Midkey loan has a new, innovative Midkey Deferral Fee that is a proportion of any increase in the agreed initial value* of your home during the loan term. The proportion is agreed upfront and calculated by dividing your Midkey loan amount by your home’s agreed initial value. We refer to this proportion as the deferred payments percentage.
Below are two Midkey Deferral Fee examples:
- If, at the start of your Midkey loan, the amount of your Midkey loan was 10% of your home’s agreed initial value, your Midkey Deferral Fee will be 10% of any increase in your home’s value over the agreed initial value during the term of your loan.
- If at the start of your Midkey loan, the amount of your Midkey loan was 20% of your home’s agreed initial value, your Midkey Deferral Fee will be 20% of any increase in your home’s value over the agreed initial value during the term of your loan.
If, at the end of your Midkey loan, the agreed initial value of your home has not increased or has decreased, you will not pay a Midkey Deferral Fee.
Making partial repayments during your Midkey loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
*For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
Note: Other differences include establishment fees, valuation and documentation costs, a settlement rescheduling fee, and specific eligibility criteria.
Midkey is funded by long-term investors who are comfortable providing accruing interest loans where the loan term is not a fixed period.
Yes, and here are some good reasons why:
- We are an Australian Credit Representative (539174) of Allied Financial Consulting Pty Ltd, which holds Australian Credit Licence 393845 issued by ASIC. Midkey Funds Management Pty Ltd is also a Corporate Authorised Representative (CAR No. 1297360) of Sandford Capital Pty Limited (ABN 82 600 590 887) (AFSL 461981).
- We use bank-level security and encryption across our digital platform to protect you and us from cyber threats.
- Our management team members have strong track records in investment banking, asset management, real estate, real estate debt, and technology including leadership, strategy and board member positions within Australian, Asian and global companies.
- If you already use a mortgage broker, you can ask them to contact us. Borrowers come to us either directly or via their brokers. Not all brokers know about Midkey yet, but they will soon!
Click here to learn more about our founders.
A Midkey No Monthly Payments Loan (called a “Midkey loan”) is different from any other kind of home loan or mortgage in Australia. Our borrowers do not make any regular, monthly payments. Instead, at the end of the loan, they pay the loan amount and simple interest (not compound interest), plus a new innovative Midkey Deferral Fee*.
There is no fixed repayment timeframe, but the loan must be repaid when you sell your home, move into aged care, die, or at other specific events agreed upfront.
The Midkey Deferral Fee is the fee you pay for the benefit of deferring all your principal and interest payments to the end of your Midkey home loan. It's a proportion of the increase in your home's value above the agreed initial value** over the loan term. The proportion is calculated by dividing your Midkey loan amount by your home's agreed initial value at the start of the loan. We refer to this proportion as the deferred payments percentage.
Making partial repayments during your Midkey loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
How the Midkey Deferral Fee works:
- If your loan is 10% of your home's agreed initial value, you pay 10% of any increase in your home's value above the agreed initial value** over the loan term.
- If your loan is 20% of your home's agreed initial value, you pay 20% of any increase in your home's value above the agreed initial value** over the loan term.
You only pay the Midkey Deferral Fee if your home’s agreed initial value increases. If it doesn't increase or it decreases, you don't pay a Midkey Deferral Fee.
We provide first and second mortgages - if you already have a mortgage over your home, your Midkey loan can be secured by a second mortgage.
*Other fees, like establishment, valuation, settlement, documentation, discharge, processing, and other incidental fees, are also payable.
**This is the agreed initial value of your home after Midkey has applied a 5% reduction to your home’s initial independent valuation.
Your home, or the one you intend to buy, needs to be a residence that is owner-occupied or an investment home. It can be a house or an apartment. It needs to be in a state capital or major population centre in Australia (excluding NT and Victoria).
We are coming to VIC soon, click here to join our Waitlist.
To qualify:
- Your home, or the one you intend to buy, needs to be located in a state capital or major population centre in Australia (excluding NT and Victoria. Click here to join our Waitlist for Victoria, where we expect to offer our loans soon.)
- You must have sufficient usable equity in your home:
- for an owner-occupied house, usable equity must be at least 20%
- for an investment house or apartment, usable equity must be at least 25%
Where usable equity is the proportion of your home’s agreed initial value that remains after subtracting all outstanding loan balances secured against it.
Example: Let’s say the agreed initial value of Emma’s owner-occupied home is $1m, and she owes $500,000 on her first mortgage home loan. This means Emma has $500,000 of usable equity in her home (i.e. 50%), making her eligible for a Midkey loan.
- If you are securing your Midkey loan with a second mortgage, your first mortgage must be a traditional “principal plus interest” home loan, and Midkey must have a priority agreement with your first lender. Midkey can help arrange this agreement, or you can choose to refinance with a Midkey Partner Lender.
- you need to be an Australian citizen over the age of 18.
- All loans are subject to Midkey’s approval.
A responsible borrower has a history of responsible financial behaviour and sufficient equity. What is sufficient equity for an owner-occupied home, investment house, and apartment is described in the FAQ “How do I qualify for a Midkey No Monthly Payments Loan?”
A Midkey loan can be a minimum of:
- $100,000
For owner-occupier houses, the amount of your Midkey loan can be:
- up to 35% of the agreed initial value of your home if your Midkey loan will be secured by a first mortgage (this means you don’t have or plan to have a traditional mortgage over your home), or
- up to 30% of the agreed initial value of your home if your Midkey loan will be secured by a second mortgage (this means you have or will have a traditional mortgage over your home).
The combined loan-to-value ratio for your home cannot exceed 80% (including the outstanding balance of any existing first mortgage home loan).
For investment properties, the amount of your Midkey loan can be:
- up to 35% of the agreed initial value of your home if your Midkey loan will be secured by a first mortgage (this means you don’t have or plan to have a traditional mortgage over your home), or
- up to 30% of the agreed initial value of your home if your Midkey loan will be secured by a second mortgage (you have or will have a traditional mortgage over your home).
The combined loan-to-value ratio for your home cannot exceed 75% (including the outstanding balance of any existing first mortgage home loan).
For apartments, the amount of your Midkey loan can be:
- up to 33% of the agreed initial value of your home if your Midkey loan will be secured by a first mortgage (this means you don’t have or plan to have a traditional mortgage over your home), or
- up to 28% of the agreed initial value of your home if your Midkey loan will be secured by a second mortgage (you have or will have a traditional mortgage over your home).
The combined loan-to-value ratio for your home cannot exceed 75% (including the outstanding balance of any existing first mortgage home loan).
One of the special features of a Midkey No Monthly Payments Loan is that you won't be given a specified calendar repayment date on which you must fully repay your Midkey loan, because a Midkey loan is only fully repayable at certain events, like:
- if you sell your home.
- if you choose to repay your Midkey loan.
- if you move into an aged care facility.
- if you die.
- if you default on specific terms in your contract with Midkey.
Your Midkey loan will be partially repayable if:
- your Midkey loan is secured by a second mortgage, and (subject to our approval) you increase the amount of your first mortgage home loan. If this occurs, you must use 25% of any increase in your first mortgage loan balance to partially repay your Midkey loan.
- at any time during your Midkey loan, the loan-to-value ratio that applies to your home is greater than 100% (accounting for your first mortgage home loan and your Midkey loan). If this occurs, you must make a partial repayment of your Midkey loan that brings the loan-to-value ratio below 100%.
- your Midkey loan is secured by a second mortgage, and, at any time, you default on your first mortgage home loan. If this occurs, you may be required to partially repay your Midkey loan.
- if you choose to make a partial repayment (see the FAQ on partial repayments).
- You have the option to partially or fully repay at any time. Otherwise, you will need to pay at the mandatory payment events described in the question above.
- If you elect to make a partial repayment, the minimum amount required is $50,000.
- Each partial repayment will require a new independent property valuation, which is arranged at your expense. A $200 partial repayment fee also applies each time.
- Making partial repayments during your loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
- Please note: Midkey loans do not include a redraw facility. This means you can’t make extra repayments and then access those funds later. However, you’re welcome to fully repay your Midkey loan at any time and, if needed, apply for a new Midkey loan.
At the end of your Midkey No Monthly Payments Loan – typically when you sell your home or choose to repay – you’ll pay:
- The original loan amount (principal): This is the amount you borrowed at the start of your Midkey loan.
- Simple interest that has accumulated on your loan amount. Midkey charges simple interest (not compounding), which means interest is calculated only on your original loan amount – not on any interest that’s already accrued. For example, interest that builds up this year won’t generate more interest next year.
- The rate is typically 1-2% higher than a traditional home loan, but lower than reverse mortgage or typical second mortgage rates.
- It’s a variable rate, linked to the Reserve Bank of Australia’s cash rate:
- Owner-occupiers: RBA + 3.25%
- Investment houses: RBA + 3.75%
- Apartments: RBA + 4.25%
- The Midkey Deferral Fee: This is a proportion of any increase in the agreed initial value* of your home during the loan term. The proportion is agreed upfront and calculated by dividing your Midkey loan amount by your home’s agreed initial value. We refer to this proportion as the deferred payments percentage.
Making partial repayments during your Midkey loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
Below are two examples of how a Midkey Deferral Fee is calculated:
- If, at the start of your Midkey loan, the amount of your Midkey loan was 10% of your home’s agreed initial value, your Midkey Deferral Fee will be 10% of any increase in your home’s value over the agreed initial value during the term of your loan.
- If, at the start of your Midkey loan, the amount of your Midkey loan was 20% of your home’s agreed initial value, your Midkey Deferral Fee will be 20% of any increase in your home’s value over the agreed initial value during the term of your loan.
If, at the end of your Midkey loan, the agreed initial value of your home has not increased or has decreased, you will not pay a Midkey Deferral Fee.
*For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
- Valuation fee (if required)
A final independent valuation may be needed. This fee is paid directly to an independent valuer, typically $300-$3,850 (quotes required for homes valued over $10 million)
- Discharge fee: Approximately $500
Note: There are no regular or monthly fees charged during the term of your Midkey loan. However, if certain events occur during the term of your loan (for example, if you want to make a partial repayment of your Midkey loan or you need to make a partial repayment because the loan to value ratio that applies to your home is greater than 100%), you may need to pay some additional fees (like partial repayment fees, valuation fees, processing fees, third party fees, and other incidental fees).
You’re welcome to make a partial repayment at any time—just keep in mind the following:
- Each repayment must be at least $50,000.
- A new independent property valuation is required for each repayment, arranged at your expense.
- A $200 partial repayment fee applies each time.
Making partial repayments during your loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
Midkey loans do not include a redraw facility. This means you can’t make extra repayments and then access those funds later. However, you’re welcome to fully repay your Midkey loan at any time and, if needed, apply for a new Midkey loan.
Here’s a breakdown of the fees that are payable for a Midkey No Monthly Payment Loan:
Upfront fees (charged at the beginning of your Midkey loan):
- Establishment fee: 1.5% of your loan amount (minimum of $3,000)
- Valuation fee: Paid directly to an independent valuer, typically $300-$3,850 (quotes required for homes valued at over $10m)
- Document preparation & out-of-pocket expenses: Approximately $450
- Mortgage registration fee: Around $187, depending on your state or territory
- Settlement rescheduling fee: $200, only if the agreed settlement date needs to be changed
You can choose to have most of these fees deducted from your Midkey loan amount – except for the valuation fee, which is paid directly to the valuer.
End-of-loan fees (charged when you repay your Midkey loan in full):
- Midkey Deferral Fee: (see “What is a Midkey Deferral Fee?” FAQ for more information).
- Valuation fee (if required): Same range as above, paid directly to the valuer
- Discharge fee: Approximately $500
There are no regular or monthly fees charged during the term of a Midkey loan. However, if certain events occur during the term of your loan (for example, if you want to make a partial repayment of your Midkey loan, or you need to make a partial repayment because the loan to value ratio that applies to your home is greater than 100%), you may need to pay some additional fees (like partial repayment fees, valuation fees, processing fees, third party fees, and other incidental fees).
* For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value, and it forms the basis for calculating your usable equity. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
Midkey’s No Monthly Payments Loan uses simple interest, not compound interest. That means interest is calculated only on your original loan amount – not on any interest that’s already accrued.
As a general guide, Midkey’s interest rate is:
- usually 1-2% higher than a standard home loan.
- typically, lower than the compound interest rates charged on reverse mortgages.
- significantly lower than rates on regular second mortgage loans.
Current interest rates for a Midkey loan (these are variable rates and linked to the RBA’s cash rate):
- Owner-occupiers: RBA + 3.25%
- Investment houses: RBA + 3.75%
- Apartments: RBA + 4.25%
Because our rates are tied to the Reserve Bank of Australia’s cash rate, they’ll move up or down in line with any changes from the RBA.
Midkey’s interest rate is typically set at a margin above the RBA cash rate, which means it can rise or fall in line with changes to that rate. You’ll be alerted to those movements during the life of your loan. Midkey calculates the interest daily, and this interest will accumulate but not be charged until the end of the loan (unless you need to make a partial repayment for any reason).
Let’s say we lend you $100,000, and our annual interest rate for owner-occupier houses is 6.85%. To calculate your annual interest, we would multiply $100,000 by 6.85%, which is $6,850. Because the Midkey loan charges simple interest, the interest that accumulates each year will remain the same throughout the life of your loan, i.e. it will be $6,850 each year (assuming the interest rate stays the same and you don’t make any partial repayments).
The Midkey Deferral Fee only applies if the agreed initial value* of your home increases during the term of your loan. If the agreed initial value of your home stays the same or goes down during the term of your Midkey loan, you won’t pay a Midkey Deferral Fee.
Here are two examples:
If, at the start of your Midkey loan, the amount of your Midkey loan was 10% of your home’s agreed initial value, your Midkey Deferral Fee will be 10% of any increase in your home’s agreed initial value during the term of your loan.
If, at the start of your Midkey loan, the amount of your Midkey loan was 20% of your home’s agreed initial value, your Midkey Deferral Fee will be 20% of any increase in your home’s agreed initial value during the term of your loan.
No increase in the agreed initial value of your home? No Midkey Deferral Fee. If the agreed initial value of your home doesn’t go up – or even if it goes down – you won’t pay a Midkey Deferral Fee at the end of your Midkey loan. But, for your sake and ours, we hope the value of your home appreciates through the roof, so we can all celebrate at the end. We love a win/win arrangement, and we hope you do too.
* For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value, and it forms the basis for calculating your usable equity. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
Think of the Midkey Deferral Fee as "the fee you pay at the end of your loan for the benefit of deferring all your principal and interest payments”. Importantly, you are only charged a Midkey Deferral Fee if the agreed initial value of your home increases.
How it Works:
- The Midkey Deferral Fee is a proportion of any increase in the agreed initial value* of your home during the term of your Midkey loan. The proportion is agreed at the start of your Midkey loan and is calculated by dividing your Midkey loan amount by your home’s agreed initial value**. We refer to this proportion as the deferred payments percentage.
For example:
If your Midkey loan is 10% of your home’s agreed initial value at the start of your Midkey loan, your Deferral Fee will be 10% of any increase in your home's agreed initial value.
If your Midkey loan is 20% of your home’s agreed initial value at the start of your Midkey loan, your Deferral Fee will be 20% of any increase in your home's agreed initial value.
- No increase in the agreed initial value of your home? No Midkey Deferral Fee. If, at the end of your loan, the agreed initial value of your home hasn’t gone up – or even if it has gone down – you won’t pay a Midkey Deferral Fee. But, for your sake and ours, we hope the value of your home appreciates through the roof, so we can all celebrate at the end. We love a win/win arrangement, and we hope you do too.
- Making partial repayments during your loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
We designed the Midkey No Monthly Payments Loan to be fair, flexible, and performance-based. If your home does well, we share in the upside. If it doesn’t, you don’t need to pay a Deferral Fee
*For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value, and it forms the basis for calculating your usable equity. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
Calculate how much you can unlock here.
If you make a partial repayment of your Midkey loan, then the proportion will decrease.
Otherwise, the proportion is agreed at the beginning of your Midkey loan and will not change during the loan term.
We refer to this proportion as the deferred payments percentage.
Your home must be valued by an independent valuer, at a cost to you, to determine the value of your home. A valuation of your home is required:
- at the start of your Midkey loan;
- each time you make a partial repayment of your Midkey loan;
- when you repay your Midkey loan in full;
- (if relevant) at the beginning and end of any renovation of your home; and
- (if relevant) if you wish to increase the amount of your first mortgage home loan.
Midkey will connect you to an independent valuer from the Midkey panel of valuers if a valuation of your home is required. Where possible, Midkey will use the same independent valuer for any valuations required throughout the term of your loan.
In most circumstances, you must pay for any valuations that are required during the term of your Midkey No Monthly Payments Loan. Valuations must be made by an independent valuer who is on Midkey’s valuation panel. Midkey can help you arrange any valuations needed for your Midkey loan.
A valuation fee ranges from $330 - $3,850 (a quote is required for a home valued over $10m), and you will pay the valuer directly.
For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value, and it forms the basis for calculating your usable equity. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
This depends on whether Midkey can arrange a "priority agreement" with your first mortgage home loan lender.
To date, Midkey has been able to arrange priority agreements with almost all banks it has engaged with.
If, in the rare case, Midkey cannot arrange a priority agreement with your first mortgage home loan provider, Midkey would encourage you to refinance your first mortgage home loan with a Midkey Partner Lender with whom we have a pre-existing priority agreement.
In most circumstances, there will be minimal restrictions on how you use the proceeds from your Midkey No Monthly Payments Loan. However, you should use your Midkey loan sensibly.
In cases where Midkey feels it is in your best interest to use all or part of your Midkey loan to repay some of your existing debt, Midkey may restrict your loan use to this purpose.
The borrowing scenarios set out on the “Why Midkey” page of this website are for illustrative purposes only.
Yes, you’re welcome to make renovations or improvements to your home during the term of your Midkey loan—provided we’ve given our consent. In some cases, outlined in your loan’s terms and conditions, you won’t need to seek approval before starting building works.
If you renovate your home, you can also apply for an "Improvement Credit" to offset the innovative Midkey Deferral Fee (which is a proportion of any increase in the agreed initial value of your home during the term of your Midkey loan).
You do. In terms of property ownership and your use of your home, a Midkey No Monthly Payments Loan operates in a similar way to a traditional home loan.
Unlike a traditional loan, a Midkey No Monthly Payments Loan does not require regular principal and interest payments, so we can be more flexible when assessing your suitability for a loan in these circumstances.
Midkey recommends that you seek both legal and financial advice before agreeing to a Midkey No Monthly Payments Loan.
To apply for conditional approval*, Midkey will need:
- an estimated value of your home.
- the address of your home.
- if you are applying for your Midkey loan to be secured by a second mortgage, Midkey will need the remaining limit of your existing first mortgage home loan (excluding any offsets but including redraw facilities).
- the personal and financial details for you (and any other borrowers).
- to do a credit check on you (and any other borrowers).
- to do an identity check on you (and any other borrowers).
- to review your bank statements (and any other borrowers’ bank statements).
To receive unconditional* approval for a Midkey loan, we will need:
a. an independent valuation of your home (we will help you arrange this), and
b. a copy of your first mortgage home loan documents (if applicable).
*Conditional approval means your loan has been assessed and approved “in principle”; however, more information may be required. Unconditional approval means your application has been fully approved, and a letter of offer from Midkey will soon follow for you to sign.
Yes. Midkey provides electronic statements to borrowers every 3 months (quarterly).
You do. In terms of property ownership and your use of your home, a Midkey No Monthly Payments Loan operates in a similar way to a traditional home loan.
The main differences are:
- Timing of payments: Traditional home loans require principal and interest payments monthly. Midkey loans have no regular monthly payments; all principal and interest can be repaid at the end of the loan.
- Assessment flexibility: Traditional lenders assess your ability to make regular loan repayments by reviewing your income, expenses, and assets. While Midkey considers similar factors for any of your priority debts, we don’t require you to prove your ability to make regular or monthly repayments on our loans.
- Unlocking home equity: Due to our assessment flexibility, even if you don’t meet traditional serviceability criteria, you may still qualify for a Midkey loan and unlock your usable home equity to increase your borrowing capacity.
- Reduce your monthly debt payments: If you want to reduce your monthly debt payments, you can use a Midkey loan to decrease the amount of your traditional home loan.
- Simple interest: A Midkey loan charges simple interest (not compound interest). Simple interest means that interest is calculated only on the original loan amount, not on accumulated interest. Our simple interest rate is roughly 1% to 2% higher than a traditional home loan.
- Repayment date: A traditional home loan typically specifies a date by which you must repay your loan, whereas a Midkey loan is only repayable on certain events, like if you sell your home, you decide you want to repay, move into aged care, or you die.
- Innovative Deferral Fee: The Midkey loan has a new, innovative Midkey Deferral Fee that is a proportion of any increase in the agreed initial value* of your home during the loan term. The proportion is agreed upfront and calculated by dividing your Midkey loan amount by your home’s agreed initial value. We refer to this proportion as the deferred payments percentage.
Below are two Midkey Deferral Fee examples:
- If, at the start of your Midkey loan, the amount of your Midkey loan was 10% of your home’s agreed initial value, your Midkey Deferral Fee will be 10% of any increase in your home’s value over the agreed initial value during the term of your loan.
- If at the start of your Midkey loan, the amount of your Midkey loan was 20% of your home’s agreed initial value, your Midkey Deferral Fee will be 20% of any increase in your home’s value over the agreed initial value during the term of your loan.
If, at the end of your Midkey loan, the agreed initial value of your home has not increased or has decreased, you will not pay a Midkey Deferral Fee.
Making partial repayments during your Midkey loan term will reduce the deferred payments percentage that determines your Midkey Deferral Fee. If no partial repayments are made, the original deferred payments percentage (agreed at the start of your loan) will stay the same.
*For every Midkey loan, we apply a minimum 5% reduction to your home’s initial independent valuation. This adjusted figure is called the agreed initial value. We apply this reduction because the economics of Midkey’s No Monthly Payments Loan are designed primarily for long-term borrowers. However, we understand that some borrowers may need short-term solutions too. By using the agreed initial value, Midkey can responsibly offer loans to both short-term and long-term borrowers – while keeping our model fair and sustainable for everyone.
Note: Other differences include establishment fees, valuation and documentation costs, a settlement rescheduling fee, and specific eligibility criteria.
What is a reverse mortgage?
Like a Midkey No Monthly Payments Loan, a traditional reverse mortgage is a home loan where all principal and interest are paid at the end of the loan, and the loan term is defined around events, rather than specific time periods.
What are the differences between a traditional reverse mortgage and a Midkey No Monthly Payments Loan?
- Eligibility: Reverse mortgages are only for older borrowers, while Midkey loans are available to anyone 18+.
- Loan type: Reverse mortgages are only secured by first mortgages. Midkey loans can be secured by a first or second mortgage.
- LVR: A Midkey loan’s maximum Loan to Value Ratio is higher than a traditional reverse mortgage - up to the age that a borrower is over 75.
- Interest: Reverse mortgages use compound interest (charging interest on interest) and usually charge 1–2% more than Midkey. Midkey uses simple interest only.
- Fees: A Midkey loan includes a Deferral Fee, which is a share of any increase in your home’s agreed initial value (see the FAQ: What is a Midkey Deferral Fee? for more details)
The Midkey No Monthly Payments Loan is regulated under reverse mortgage provisions. However, ASIC has granted some specific exemptions to Midkey, meaning some reverse mortgage regulations do not apply to a Midkey loan.
In basic terms, a shared equity scheme is when the government or another party pays a proportion of the value of a property in exchange for an ownership share of the property.
In Australia, shared equity schemes are typically only available via government schemes, and generally, they are only provided for social impact benefits.
Midkey doesn’t operate a shared equity scheme.
The key difference between simple interest and compound interest lies in how interest is calculated and added over time.
Compound interest grows faster because each month, the interest owed is added to your loan balance. You then pay interest not just on your original loan, but also on the accumulated interest—causing the principal amount of your loan to increase month by month.
Simple interest, on the other hand, is calculated only on your original loan amount. Your principal loan amount stays fixed, and you’re never charged interest on interest. Simple interest works in your favour when you borrow money. As a borrower, simple interest is better because you're not paying interest on interest.
A first mortgage is the primary loan taken against a property from a bank or lender. This is the standard home loan most people think of when buying a home.
A second mortgage is an additional loan secured against your home, on top of your existing mortgage. It allows you to borrow money again using the same property as collateral.
If you’re unable to repay your loans and your home needs to be sold, the lender holding your first mortgage is paid out first. The second lender is then repaid from whatever funds remain.
Even though a Midkey No Monthly Payments Loan does not require regular monthly payments, it is still possible to default on your loan. Examples of potential default events include:
- receiving an LVR notice (because your home’s loan-to-value ratio exceeds 100%) and failing to pay the amount specified in that notice.
- increasing the loan amount of your first mortgage home loan without Midkey's written consent (if your Midkey loan is secured by a second mortgage).
- defaulting on your first mortgage home loan (if your Midkey loan is secured by a second mortgage).
- receiving a Midkey loan reduction notice due to a default on your first mortgage home loan and failing to pay the amount specified in that notice.
- providing information that is materially incorrect or misleading.
- undertaking renovations on your home without our consent.
- becoming bankrupt or insolvent.
- failing to maintain insurance, pay rates/taxes, or keep your home in good repair.
Additional default conditions are outlined in your Midkey loan documents.
Yes, Midkey will do a credit check. Midkey will ask you to provide your financial details and check your bank statements during your loan application.
Yes, Midkey Funds Management Pty Ltd is a Corporate Authorised Representative (CAR No. 1297360) of Sandford Capital Pty Limited (ABN 82 600 590 887) (AFSL 461981).
Midkey Funds Management Pty Ltd is an Australian Credit Representative (539174) of Allied Financial Consulting Pty Ltd, which holds Australian Credit Licence 393845 issued by ASIC.
The key difference between simple interest and compound interest lies in how interest is calculated and added over time.
Compound interest grows faster because each month, the interest owed is added to your loan balance. You then pay interest not just on your original loan, but also on the accumulated interest—causing the principal amount of your loan to increase month by month.
Simple interest, on the other hand, is calculated only on your original loan amount. Your principal loan amount stays fixed, and you’re never charged interest on interest. Simple interest works in your favour when you borrow money. As a borrower, simple interest is better because you're not paying interest on interest.
A second mortgage is an additional loan secured against your home, on top of your existing mortgage. It allows you to borrow money again using the same property as collateral.
If you’re unable to repay your loans and your home needs to be sold, the lender holding your first mortgage is paid out first. The second lender is then repaid from whatever funds remain.
What is a reverse mortgage?
Like a Midkey No Monthly Payments Loan, a traditional reverse mortgage is a home loan where all principal and interest are paid at the end of the loan, and the loan term is defined around events, rather than specific time periods.
What are the differences between a traditional reverse mortgage and a Midkey No Monthly Payments Loan?
- Eligibility: Reverse mortgages are only for older borrowers, while Midkey loans are available to anyone 18+.
- Loan type: Reverse mortgages are only secured by first mortgages. Midkey loans can be secured by a first or second mortgage.
- LVR: A Midkey loan’s maximum Loan to Value Ratio is higher than a traditional reverse mortgage - up to the age that a borrower is over 75.
- Interest: Reverse mortgages use compound interest (charging interest on interest) and usually charge 1–2% more than Midkey. Midkey uses simple interest only.
- Fees: A Midkey loan includes a Deferral Fee, which is a share of any increase in your home’s agreed initial value (see the FAQ: What is a Midkey Deferral Fee? for more details)
The Midkey No Monthly Payments Loan is regulated under reverse mortgage provisions. However, ASIC has granted some specific exemptions to Midkey, meaning some reverse mortgage regulations do not apply to a Midkey loan.
In basic terms, a shared equity scheme is when the government or another party pays a proportion of the value of a property in exchange for an ownership share of the property.
In Australia, shared equity schemes are typically only available via government schemes, and generally, they are only provided for social impact benefits.
Midkey doesn’t operate a shared equity scheme.
If you're looking to boost your borrowing power, securing approval for a typical home loan increase is becoming harder—especially if a traditional lender doubts your ability to service the extra debt.
A Midkey No Monthly Payments Loan doesn’t require monthly repayments, making it a flexible alternative to traditional home loans. A Midkey loan allows you to unlock usable equity in your home—even when conventional lenders can’t assist. This means you can unlock the funds you need to invest in another property, consolidate debt, or seize opportunities that might otherwise be out of reach.
Yes, the Midkey loan includes a no-negative equity guarantee. This means you’ll never owe more than the value of your home—even if property prices fall. It ensures your loan balance won’t exceed your home’s market value.
When considering a Midkey loan, you should think carefully about its potential impact on:
- your eligibility for Centrelink payments.
- your ability to pay any long-term and future costs, including any costs associated with ageing (e.g. medical expenses, aged care accommodation or in-home care services).
- whether you want to leave equity in your home to your estate.
We’d recommend you obtain independent legal and financial advice about these matters. We’d also recommend you discuss them with anyone who may be impacted by your decision to get a Midkey loan, including your family members, and, where relevant, beneficiaries.
All the above considerations are important. We’d like to discuss them with you. Please contact us on 1300 643 539 (1300 MIDKEY).
No, a Midkey loan does not contain a tenancy protection provision and will affect the rights of other people living in your home.
Suppose your Midkey loan needs to be repaid from the sale of your home. In that case, other people living in your home who are not borrowers (including your spouse, partner, other family members, or tenants) will need to move out and live elsewhere. For example, if you need to move into aged care accommodation, you may need to sell your home, and this will impact the ability of other people to continue living in your home.
We’d recommend you obtain independent legal and financial advice about these matters. We’d also recommend you discuss them with people living in your home who may be impacted by your decision to get a Midkey loan, such as your family members, any beneficiaries, tenants, etc.
All the above considerations are important. We’d like to discuss them with you. Please contact us on 1300 643 539 (1300 MIDKEY).
Yes. Midkey complies with the National Credit Code and the National Consumer Credit Protection Act 2009. These laws are administered by the Australian Securities and Investments Commission (ASIC).
Yes! Midkey partners with brokers across Australia to offer their clients our Australian-first, unique lending solution. If you’re interested in working with us, please contact broker@midkey.com.au.
Our Broker Relations Team will guide you through how Midkey works and provide the resources you need to achieve the best results for your clients.
You’ll save time while we do the heavy lifting. A Midkey Loan Specialist will prepare an Indicative Summary of the proposed deal for your client, and once they’re happy to go ahead, we’ll take it from there — managing the process from application right through to settlement, while keeping you in the loop.
Because we help borrowers who face serviceability challenges with traditional lenders, you can offer more clients a genuine solution — one that gives them access to funds without monthly repayments or restrictive loan terms.
Yes. For deals introduced by a broker that proceed to settlement, we offer a referral commission payment as part of our partnership agreement. Currently, Midkey does not pay a trail. Please enquire directly for details.
Midkey’s Broker Relations team is here to support you nationally. The key contacts are:
Amanda Hall (Sydney). Amanda specialises in NSW and ACT, but she can assist with properties in other states. amanda.hall@midkey.com.au (mob) 0400 123 456
Lev Susany (Brisbane). Lev focuses on Queensland, but he can assist with properties in other states. Lev.susany@midkey.com.au (mob) 0400 654 321
Please note we are currently not operating in Victoria, but we hope to change that very soon, so jump on our Waitlist.