Maximum Bond and Charge Interest Rate
*The information on this page only applies for residents who first entered care before 1 July 2014*
The Maximum Bond Interest Rate is the maximum interest rate chargeable on accommodation bonds paid after the due date, periodic payments, and overdue fees under a resident agreement, bond agreement or extra service agreement which are deducted from the accommodation bond balance.
Maximum Accommodation Bond Interest Rate (previously Treasury Note Yield)
There is no legislative requirement for interest to be charged on overdue amounts of accommodation bonds. However, if interest is to be levied on overdue amounts, the accommodation bond agreement entered into between the service provider and the resident must specify details including the rate to be charged and the circumstances when that rate may be levied.
The maximum accommodation bond interest rate for residents is set at date of entry into care. The relevant rate can be found in the Schedule of Resident Fees and Charges for pre 1 July 2014 Residents.
This is the maximum interest rate that can be charged for residents:
- on lump sum accommodation bonds which are paid after the date due, including bonds which are unpaid at the time of departure from the aged care home;
- on periodic payments of accommodation bonds;
- on amounts owed which may be deducted from the bond balance; and
- in certain situations where the resident leaves the aged care home within 2 months of entering care.
Agreements may specify a rate that is less than the maximum permissible level.
Maximum Accommodation Charge Interest Rate
The maximum permissible accommodation bond interest rate does not affect residents who pay an accommodation charge.
The maximum interest rate on overdue payments of the accommodation charge for residents entering into accommodation charge agreements is set at date of entry into care. The relevant rate can be found the Schedule of Resident Fees and Charges for pre 1 July 2014 Residents.
A lower rate may be specified in the agreement.
For more information call the My Aged Care national contact centre on 1800 200 422 (free call except from mobiles).