CBA: Govt to blame for pulling zero deposit loans

by 18 Nov 2008

The Commonwealth Bank has blamed the government's First Home Owners Grant (FHOG) boost for its decision to withdraw its zero deposit product.

Effective 1 December, the lender will pull its zero deposit home loan from the market.

Speaking to BN last week, a spokesperson for the bank said the move was in line with the CBA's commitment to responsible lending practices in turbulent economic times.

However more recent communiqu‚ outlining the move to brokers blamed the decision on the government's FHOG boost.

"This increase in federal government assistance, plus additional grants from some state governments, lessens the need for first time buyers to borrow 100% of the purchase price of the property," it stated.

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COMMENTS

  • by Karen 19/11/2008 4:46:16 PM

    Wont help first home buyers much.... we all know that the LMI premium will just be sucked up by the FHOGs anyway, leaving FHB still needing to find the balance of the purchasing costs. Anyway, the FHOGs Boost is at this stage only available for a limited time.
    CBA no longer offers the premium product in this space.