Europe's debt crisis to affect home loans applicants?

Friday 06 May 2011

Home loans customers may be among those affected by the debt crisis in Europe in light of recent comments by ANZ chief executive Mike Smith.

Home loans applicants to be affected by debt crisis in Europe?

The bank boss asserted that the cost of borrowing for banks could increase due to the instability in the credit market, reports the Australian Associated Press (AAP).

He stated: "The wholesale credit markets are going to get affected and it's going to create massive volatility, so again[the] cost of borrowing may well increase and that will affect the banking system here."

If this does occur, consumers looking for funding to purchase a house may find that going online to compare home loans becomes even more important as they strive to get the best deal available.

According to the AAP, those borrowing through ANZ may be less likely to be affected by the problems in Europe because the financial institution has reduced the level on which it relies on offshore wholesale credit markets.

In February this year, the total amount of money lent to people securing home loans dropped 4.6 per cent, figures from CommSec revealed.

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