As mentioned in my intro and the feature article on mortgage managers, the NAB has recently announced it’s acquisition of James Packer’s Challenger (now known as Advantedge) and made a commitment to fund mortgage managers without the need for securitisation, meaning increased competition in the lending industry and more options for borrowers.
Most banks have increased their stress testing for new loan applications and some of the resulting changes we have seen include; an increase in the living allowance, called the Henderson Poverty Index (AKA HPI) and lenders now assessing the loan applied for and other facilities held as if they were all Principal and Interest, even if the new loan requested is Interest Only.
With the RBA’s three consecutive increases to the cash rate over the past 6 months, fixed rate options from lenders have increased dramatically over the last 8 weeks. As a result it’s very hard to justify taking on a fixed rate loan at the moment. Here’s a snapshot of who’s offering what;
As at 10th December 2009
| 3yrs | 5yrs | |
|---|---|---|
| AMP | 7.89% | 8.39% |
| ANZ | 7.69% | 8.04% |
| Bankwest | 7.79% | 8.09% |
| CBA | 7.74% | 8.04% |
| ING Direct | 7.79% | 8.14% |
| NAB | 7.59% | 7.89% |
| Rams | 7.29% | 7.74% |
| StG | 7.49% | 7.89% |
| Suncorp | 7.54% | 7.94% |
| Westpac | 7.59% | 7.94% |
