Australian banks have started to make changes to lending policy and pricing in bid to curb their level of investment lending.
The changes range from modifications to servicing criteria to loan to value ratio restrictions.
In addition, all of the majors of banks increased interest rates across a number of investment and interest only loans.
While the vast majority of the changes being made only apply to investment loans, others affect owner occupied home loans as well.
What do these changes mean for you and your bottom line?
These changes will make it harder for potential investors to obtain finance to fund their property investment purchase.
1.) Although if you already have other investment properties or an owner occupied home that you can use as leverage, you should have no problems obtaining finance.
2.) If you don’t have other properties, you may find (depending on the lender you go with) that you have to have a 20% deposit. Not all lenders have this rule, so you may find you can still fund an investment property with a much smaller deposit.
If you already have an investment property, you may find you soon (depending on your lender) have to pay a higher interest rate as some of Australia’s banks have increased the interest rates on their investment loans.
Concerned about how the changes may affect you either now or in the future, speak with a professional. At Mortgage Choice, we have access to a wide choice of lenders and hundreds of products, so we can help you navigate through the current investment lending changes to find the right lender and loan for your needs, so why not give us a call today on 13 66 78 or visit our website www.mortgagechoice.com.au