'The days of 100% home loans are over'
Article by Mozo
Banks are refusing to offer no-deposit home loans despite a surge in demand from borrowers, it has been reported.
Industry broker Loan Market Group said requests for 100 per cent home loans have more than doubled in the past few months.
However, it noted that lenders have ignored such calls and are instead increasing the deposit amount for new loans, News Limited reported.
The growth in demand for 100 per cent home loans has followed the scaling back of the first-homeowner grants, the body noted.
Loan Market chief operating officer Dean Rushton said that 100 per cent mortgages are no longer a viable option for people looking to compare home loans.
"I think it’s a case of them being consigned to the lending museum. There is no appetite for this type of risk anymore. I don’t believe we’ll be seeing these products again, even for a fee. There’s just no margin for error," he added.
The recent AFG Mortgage Index revealed that property investors are making up a growing proportion of home loan applicants and recipients.
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