The Australian banking environment has changed substantially over recent years. There has been an unarguable tightening in credit, which became even more restrictive following the Banking Royal Commission, along with a potentially related slowdown of housing lending during 2019.
As property prices rise over time purchasing in a centrally-located or sought-after area is out of reach for the average working millennial. Instead, many are opting to rent rather than buy as it means not having to compromise their inner city or beachside lifestyle. But for those who are still eager to enter the market, there is a way to get the best of both worlds. Continue reading Rentvesting – enter the property market without sacrificing your lifestyle
The mortgage industry is a wide, wondrous world with a language all of its own. One of the many acronyms bandied about is ‘LVR’, which stands for ‘loan-to-valuation ratio’. Here’s what it means. Continue reading What is LVR?
There is no doubt that home loan lenders across Australia have tightened their lending requirements over recent years and borrowers now need to provide more detailed information to obtain a home loan.
For many borrowers this is leading to frustrating delays in applications and approvals. In many cases it is impacting the ability of potential home purchasers to obtain a home loan in the house price bracket they are seeking.
Below are some tips on how to approach your home loan application to give you the best chance of a positive result the first time!
Within financial circles many advisers and commentators regularly talk about the negative aspects of bad debt and positive approaches to good debt.
But to many the difference is a mystery – isn’t debt just debt?
Lets first consider what good debt is. Good debt is referred to as that debt that assists in building net worth through either income and / or the holding of an asset that will appreciate in value. This type of debt could also often be tax deductible.
Over recent months it has been very noticeable that banks have been increasing interest rates and tightening credit policy for interest only loans, regardless of whether they are for Investment or Owner Occupation.
In mid 2015 we highlighted through this Blog that Banks were tightening credit policy in regards to investment lending and that had resulted in tightening of lending criteria.
This was initially due to communications from APRA to all Approved Deposit-taking Institutions (ADI’s) about expectations of a range of measures to reinforce sound residential mortgage lending practices. An ADI is basically a bank, credit union or building society. APRA’s expectation was that ADI’s maintain growth in investment lending portfolios to below 10%. Those communications quickly lead to Bank’s: Continue reading Investment Loans – Banks tighten loan criteria