Like other banks and financial institutions, online lenders must adhere to certain laws and regulations laid out by regulatory bodies. In particular, they have to take steps to ensure it’s not beyond a borrower’s means to pay off a loan, as well as provide borrowers with relevant information to make informed decisions along the way.Online lenders that are also authorised deposit-taking institutions (ADIs) are regulated by the Australian Prudential Regulation Authority (APRA). Some examples are 86 400, ING, and UBank. Many online lenders don’t have an ADI license however, as they’re not in the business of providing savings accounts or term deposits. These include Athena Home Loans, Homestar, and loans.com.au.While non-bank lenders aren’t regulated by APRA, they’re still subject to strict credit legislation, and can be ruled on by the Australian Securities & Investments Commission (ASIC) if they’re found engaging in misleading or deceptive conduct.
Spring has sprung which means the property market has started to heat up, but so too has the home loan market, with lenders making a series of cuts in recent weeks and more likely to come in the month ahead.
Competition on the home loan front continues to heat up, with People’s Choice Credit Union recently dropping interest rates for its Basic Variable Rate home loan to new lows.The offering currently sports a variable rate of 2.49% p.a. (2.49% p.a. comparison rate*), which is available to owner occupiers making principal and interest repayments. For comparison, the average variable home loan rate in our database currently sits at 3.36% p.a.There are no upfront fees and plenty of useful features to help you save on interest, such as the ability to make unlimited extra repayments. You’ll also be able to redraw any extra amounts you’ve repaid on the loan if you feel they’d be better served back in your pocket.Along with the Basic Variable Rate, PCCU is also offering a number of attractive fixed rate home loans, including the First Home Buyer Fixed Rate Loan (Package). This comes with a 1.99% p.a. 1-year fixed rate (3.91% p.a. comparison rate*), and is available to borrowers who have never previously owned a residential property.We’ve included an overview of three PCCU home loans below, but for a full list of offerings from the credit union, along with customer ratings and reviews, be sure to visit our PCCU home loans page.
As lenders compete for home loan customers amid continued rate cuts, some are offering significant reductions on Lenders Mortgage Insurance (LMI).Today, ME Bank announced a 25% cut to LMI for first home buyers combined with discount variable rates on the ME Flexible Home Loan. LMI is typically required on loans with a Loan to Value Ratio (LVR) below 80% (that is, when the deposit is less than 20% of the value of a property). Allowing borrowers with lower deposits to avoid this could cut thousands of dollars from the overall cost of a home loan. “We’ve combined our lowest-ever variable rate, no ongoing fees and our fully featured home loan product with an innovative LMI discount to help first home buyers smash through the deposit hurdle,” ME general manager of home lending, Andrew Bartolo said. To access ME's reduction and attractive new interest rates, borrowers must have a minimum 5% deposit, intend to live in the property, and start paying back the principal loan amount plus interest. Unlike many first home buyer offers, borrowers can still apply if they have previously or currently own a residential investment property.The top 2.58% p.a. rate will be reserved for customers with a LVR under 80%. However, those with smaller deposits will still see substantial interest rate drops from ME’s current 4.31% p.a. headline offer. These start from:- 2.79% p.a. for borrowers with an LVR between 80% and 90% - 3.59% p.a. for those with an LVR over 90%RELATED: St.George reduces Lenders Mortgage Insurance to just $1 for first home buyers.Virgin Money is going one step further and making LMI $0 for eligible borrowers, whether they’re first-time buyers or upgrading to a new property.To be eligible, home buyers must apply for a Reward Me Home Loan (OO, P&I) with a deposit of at least 15% of the property’s value. This offer also comes with discounted rates, including:- Variable rates starting from 2.89% p.a.- Fixed rates starting from 2.49% p.a.Home loan customers considering Virgin Money’s offer can apply until 29 November, but must have their loan settled by 30 May next year.At ME Bank, borrowers can apply from today until 20 November, 2020, and need to settle by 26 February, 2021.If you want to scan more mortgage options, check out the offers below or head to Mozo’s first home loan comparison page.
Depending on your circumstances, a home loan could be the biggest line of credit you take out in your lifetime. So it’s important to be 100% confident when applying for a mortgage, whether it’s online or at a bank branch.Online home loans are becoming increasingly prominent and popular, particularly in response to COVID-19, with traditional banks and dedicated online lenders offering paper-free applications you can fill out without leaving your living room. If you’re considering applying online – with an exclusively digital lender or a bricks-and-mortar bank – make sure you read these pros and cons of online home loan applications first.
ING has reduced the interest rates on two of its most popular home loans by 10 basis points in a move which takes the online lender’s owner-occupier variable rates to new lows.
It’s good news again for borrowers! Today, People’s Choice Credit Union cut its home loan rate by 20 basis points. The Basic Variable Home Loan now has a rate of 2.49% (2.49% comparison rate*) down from 2.69% (2.69% comparison rate*). According to the Mozo database, the average rate for basic, owner occupier, principal and interest variable home loans sits at 3.15%. That means People’s Choice Credit Union’s rate sits a solid 0.66% below average. Want to get to know this mortgage option a little better? Read below!
Border closures caused by the coronavirus pandemic are expected to impact housing demand by between 129,000 and 232,000 dwellings over the next three years, according to new research by the National Housing Finance and Investment Corporation (NHFIC).Housing demand in capital cities is typically fuelled by population growth, but the NHFIC estimates Australia’s population could fall by up to 214,000 between 2019 and 2021. This would represent the steepest decline since World War I.Driving this contraction is the closure of international borders, which has brought the number of people arriving to Australia’s shores to a near standstill. This has been most keenly felt in the capital cities, where new arrivals tend to gravitate. Last year, 84% of migrants to Australia settled in a capital city, with three quarters opting for Sydney or Melbourne. The decrease in underlying demand adds to the mounting problems currently facing the construction sector. After about 162,000 homes were built in 2019, the NHFIC estimates this could drop to 137,000 this year, and 108,000 in 2021.
Hundreds of thousands of Australians are set to receive a call from their banks as loan repayment deferrals begin to end in September and October for some mortgage and business customers.
From choosing your ideal suburb to furnishing your new digs, there’s plenty to get excited about when buying a home. For most people, the first thing on the to-do list should be finding a perfect home loan fit.There’s heaps of choice in this area. Even with a single lender, there could be a dozen home loan options to investigate. Plus, during times of economic uncertainty (aka the COVID-19 world) the details of these offerings can change regularly.If you’ve skimmed the options and are feeling overwhelmed, here are some of the questions you should be asking. It’s kind of like a personality quiz, but for home loans.
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