- Posted By Rebecca Bell
When we last looked at the investment market we reviewed a number of key changes brought about by the Australian Prudential Regulatory Authority‘s (APRA) review of the Banking system & the level of exposure to the residential investment market in particular the high level of interest only loans Banks had exposure to.
Under APRA instructions Banks made wide changes to policies, products & of course interest rates to better reflect the risk associated with an intent to see Bank’s reduce exposure. Each Bank had different measures and areas to concentrate on and as a result we have seen a wide and varied approach to changes not only in interest rates but also specific lending restrictions to postcodes throughout Australia that are deemed to be high risk to that particular Bank.
Whilst many of the changes are here to stay and now part and parcel of lending landscape we are now starting to see the green shoots of competitiveness return to the market. Some Banks looking to attract investment lending are offering very sharp rates of sub 4%. Whilst restricted in the main to sub 80% LVR range and P&I repayments it is a pleasing sight to see following the restrictions and interest increases incurred by investors in recent times.
With this in mind it is definitely time to be reviewing rates proactively and make sure your loan/s are in a healthy place rate wise. A rate reduction of just 0.25% can certainly have significant effect on your saving with many people potentially in a position to save even more based on their current rates, savings could potentially magnify.
Interest rates changes are not only in the variable rate space with Fixed Interest Rate offerings also attracting some interest amongst clients particularly in the 2 & 3 year range.
Couple the above with ongoing competition in the owner occupied rates there is certainly some opportunity to review your portfolio & make sure your home loan health check covers all facets of your financial position.
The myriad of changes including rate options remains a difficult one to follow and keep abreast of. Having an advisor or a Mortgage Broker who can be across all the relevant changes and provide your best options available is a great way to ensure you maximise your investment portfolio. The team at First National Broome highly recommend the services of North West Finance who can be contacted here.
Article provided by North West Finance