Investment Lending Changes
There has been a lot of media attention recently on APRA (the bank regulator) and investment lending. I thought I’d send a quick update to let you know what the changes are and what it means for you.
Essentially APRA has gathered the banks together and said they didn’t want to see the banks property investor loans growing more than 10% per annum. This measure implemented to reduce growth in the property market and potentially avoid a crash once rates start tracking up.
Unfortunately the banks didn’t take much notice and kept lending the way they were – growing above the threshold. However the banks were reminded to slow down again which didn’t have much effect.
APRA said enough was enough, earlier this month they told the banks that they’d need to hold twice the amount of capital against their home loans, which impacts their profits and your rates.
What does this all mean for me?
- ANZ – Announced investment loan reference rate increasing by 0.27%, effective 10 August.
- CBA – Investor loans increase in rates by 0.27% for new and existing loans effective 10 August.
- NAB – 0.29% increase to Interest Only Loans, new loans effective 10 August; existing loans 10 September
- Westpac – Maximum LVR for new stand‐alone Investment lending now 80%, if combined with owner‐occupied LVR not restricted to 80%.
- Suncorp – Interest Only maximum of 90% inclusive of LMI; Special offers exclude Investor and Interest Only loans.
- St. George – Non Owner‐occupied lending restricted to 80% LVR.
- ING – Investment loans in NSW, maximum LVR 80%, elsewhere 90%; Investment lending above 80% interest rates have also been increased.
- BankWest – Max LVR 80% where any part of the loan is for investment; Discretionary discounting discontinued for Investment Purposes.
- AMP – Existing investor loans increased by 0.47%; AMP temporarily withdrawing from Investor lending market, “expected to last until later in 2015, depending on market conditions.”
More than ever it is important for you as a property owner to ensure your portfolio is structured in a way to hedge yourself from individual bank policy changes.
At Hunter Galloway – Home Loan Experts, we have access to a wide range of lenders and literally hundreds of products, so we can help you navigate through the current lending changes to find the right lender and loan for your needs. We do all of the legwork on your behalf so that you won’t have to worry about a thing.
Contact us today – Nathan Vecchio – 0410 000 689