Jun 2017 2 Minutes
Interest Only Loans
Author: Julie Bishop | Finance Specialist | Walker Wayland
It is often said that ‘the only thing constant in life is change’ – and the residential lending market is no exception!
The last couple of weeks have seen the majority of lenders (including Banks, second tier lenders and Credit Unions) announce changes to their interest only lending policies to help them to continue to meet their regulatory requirements imposed by APRA.
The most notable and impactful changes I have seen (from the plethora of lender update emails!) include the larger lenders reducing the maximum LVR of interest only lending down to 80% on both new and existing loans AND for owner occupier and residential investment loans alike. Additionally, we have seen many lenders increase applicable rates on interest only lending.
On the flip side, rates remain lower or have been discounted on loans with principal and interest repayment structures, in a bid by lenders to make those loan products more attractive.
In this ever-changing lending environment, with lenders continually altering policies to meet regulations, it is difficult for even the most discerning borrowers and investors to know where their loans are best placed. In these times, it is even more advantageous to have an experienced broker negotiating for you.
If you’ve had notification of an increase in your current rate, looking to negotiate new residential finance, or simply haven’t reviewed your lending in some time, please give me a call to discuss and compare the market for you.
Julie Bishop | 0477 899 922 | [email protected]