With unprecedented times due to COVID-19, the lending landscape is undergoing some changes. Here is a quick 2 minute update to keep you all informed:

  • 2 Major banks have recently introduced $4,000k & $2,000 refinance rebates to source new business (conditions apply).
  • Variable Owner Occupied Rates for P&I from 2.64% p.a. (eligibility subject to LVRs and servicing strength).
  • Fixed Owner Occupied Rates P&I from 2.09% p.a. (eligibility subject to LVRs and servicing strength).
  • Investment Lending Rates are more competitive than they have been in the past 3 years as banks are now targeting this sector for refinancing.
  • Particular industries have been flagged as high risk with stricter income verifications required, including hospitality, tourism, aviation, sport, arts, recreation and retail.
  • Banks and lenders are lending favourably to Essential Service Workers, namely police/fire fighters/ambulance officers, nurses and healthcare workers/doctors, teachers…etc.
  • Most banks and lenders are still considering loans for applicants with reduced wage rates/hours provided loan servicing is demonstrated.
  • Some banks and lenders are requiring self-employed applicants to provide March Q3 BAS to verify no downturn in trading results.
  • Restrictions for borrowers seeking cash out (only some lenders) eg. if refinancing, borrowing more than $5,000 – $10,000 above the loan balance.

The property market in Victoria, has seen a significant amount of stock come onto the market over the past 1-2 weeks. The majority are panicked investors (in certain suburbs) selling for fear of a downturn, however we have a large number of buyers waiting to pounce on opportunities once Stage 3 restrictions are lifted in Victoria. The message here is that it may not a good time to sell based on abundant stock levels and people temporarily retreating from the market (although real estate agents won’t tell you this.) Unless you are in the sub $600k market where the Federal Government First Home Loan Deposit Scheme (and stamp duty concessions for first home buyers) is propping up property prices. Note, If the market falls 10% this will be where property prices were July/August last year as there has been a 10% increase from this period to March 2020.

The banks are “open for business”. If you have any questions or queries regarding your lending needs please contact myself or Hayley.