Banks 'are more selective in their mortgage lending'

Monday 19 April 2010

Article by Mozo

Australia’s banks and financial institutions have developed tighter lending criteria which has made it harder for customers to compare home loans and secure a good deal, it has been suggested.

Chris Acret, managing director of Smartline Personal Mortgage Advisers, told News Limited that while such changes have not made securing a mortgage an "insurmountable task", it is "certainly a lot more challenging and time-consuming".

He advised borrowers to take various steps to boost the likelihood of a successful home loan application. These included cancelling unnecessary credit cards, consolidating loans and seeking specialist advice.

Meanwhile, Aussie Home Loans chief executive Stephen Porges told the news provider he expected tighter lending conditions to continue for the foreseeable future.

He added that every customer should be aware that each bank is changing their criteria "often and aggressively".

A recent report by the Sunday Telegraph suggested that home loan rates will rise to ten per cent over the next two years.

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