Investment crackdown confusing borrowers, broker head claims

by Adam Smith04 Aug 2015
Moves by lenders to clamp down on investment are proving confusing to borrowers, according to one broker network head.

1300HomeLoan managing director John Kolenda has said banks' moves to raise rates on investor loans will serve to confuse borrowers.

“Not only are rates for investors going up, but people on interest only loans are being targeted while there is a great variation now for all those looking to borrow money for investment purposes. Not only have there been changes in rates but now lenders loan servicing calculations, Loan to Value Ratio (LVR) requirements and using rental income to help service have changed," Kolenda said.

There could be a silver lining for brokers, though, Kolenda suggested.

"Investors who have already bought and are waiting to settle should see their mortgage broker as borrowing conditions have changed dramatically and they need to make sure they will be in a position to settle their purchase now that the goal posts have been changed,"  he said. “It highlights the need for mortgage brokers to help navigate borrowers through the maze.”


  • by Victoria Broker 4/08/2015 9:07:17 AM

    Couldn't agree more, the end customer is the one suffering here both with being confused with goal posts changing daily and having what was once a good deal now turning into a rip off due to factors outside of their own control. Where is the MFAA and FBAA in all of this, shouldn't they be lobbying the Govt and applying pressure to APRA to look at the bigger picture together rather than allowing them to apply the bully tactics we are seeing of late. The banks need to protect their margins so slower volume plus higher rates = protecting profits which I understand. MFAA/FBAA, where are you in all of this....what are we paying you for?

  • by Bob 4/08/2015 9:14:20 AM

    Correct, ADI's confusing borrowers is indeed good for brokers.

  • by Bottom line.... 4/08/2015 9:58:39 AM

    I doubt its a "silver lining", as the broker would have initially written the deal that is waiting for settlement - just means they may have to find another lender & do it all over again.
    All APRA have achieved, is to cause doubt, confusion, & mostly distrust of the banking system, at a time when the government are desperate to try do the opposite.
    Consumer confidence was low before; now it's even lower.
    You don't regain confidence in the public, by constantly throwing out new rules at a whim - now it will take years to even get back to where we were.