Are credit conditions easing?

Here are some recent indications of easing credit conditions...

Macquarie returns to lo-doc loans

AMP cuts rates on entry-level mortgages

CUA slashes variable mortgage rates

What do people think - are these just isolated examples, or a sign of further easing to come. If the NBLs start to come back in force that should put pressure on banks to keep rates low.

But at the same time we have Westpac threatening to raise rates above future OCR raises, and CBA reducing LVRs for development loans, share portfolios and personal investments...

Westpac warns of rates pressure

CBA tightens screws on lending

What other recent examples of credit easing or tightening have you seen?
 
one can only hope - it is too difficult to pretty much do anythign at the moment, even no brainer deals seem to fall outside policy guidelines
 
I'll believe it when I see lo-docs or no-docs for over 60% easily available again. You know the kind, the ones that don't need 3 years of BAS statements, DNA, and your firstborn.

But if anyone knows who does them, I'm a soil test and a title (bah, 4-6 week wait for a title indeed) away from grovelling my way to the nearest bank for a good lodoc :D
 
i dont get this bas lo doc thing - wouldnt you just go full doc if you had all that? or is that the point, effectively there is no lo doc?
 
What kind of regulation is there surrounding No-Doc and Low-Doc Loans? Is there regulation or is it all self regulated by the banks individual policies?
 
i dont get this bas lo doc thing - wouldnt you just go full doc if you had all that? or is that the point, effectively there is no lo doc?
Yeah, that's the point. If you've only got a few months worth of BAS statements, or you have interesting mixed income like us, or just want to exaggerate your income to get a deal over the line, you really need those 'proper' lo doc loans where you just sign something saying you earn X.

I'm actually hoping I can swing the next deal in cash, but I'm not holding my breath. The stars need to seriously align for that to happen.
 
no

while some full doc lvrs are a little better here and there than 6 mths ago, overall the outlook is poor.

Add to that the new legislation that will make it hard for anyone to lend money to someone unless u can categorically verify their income and to some extent their outgoings today and make some guesses about their future

ta

rolf
 
Here is a potential idea, i dont know whether it would work or not.
Most banks have 'packages' which give upwards of 0.7% off the the 'going rate'.
These packages used to actually have some value when they were scarce (i remember in the late 90's you had to be a qualified accountant with CBA to get hold of their 'professional package).
Now every tom dick and harry can apply for one.

So here is the idea, tell the bank manager you are happy to pay the 'going rate', ie no discount required.
This will increase the margin that the bank receives and maybe will get some people over the line.

The trouble is when people want both, squeeze the margins and demand high LVR's.
 
no

while some full doc lvrs are a little better here and there than 6 mths ago, overall the outlook is poor.

Add to that the new legislation that will make it hard for anyone to lend money to someone unless u can categorically verify their income and to some extent their outgoings today and make some guesses about their future

ta

rolf

What Rolf said, plus what i said:

Finance is a problem for a lot of people.

Not that getting finance itself is the problem....just getting it on the terms they are used to or think they are entitled to.

I said here or elsewhere a long time ago that credit-tightening is a subtle thing. Everyone expects "marginal borrowers" to find it difficult, but, of course, they tend to think everyone else is a marginal borrower.

It will continue for some time ,slice by slice(I for one, expect to the see the policy distinction between OOs and investors becoming more marked and, potentially, life being made more difficult for brokers by the majors). There will be the odd headline around increasing LVRs or whatever out of some lenders etc which will get the usual suspects excited about a return to the pre-2007 days, but closer inspection will reveal conditions, credit scoring requirements and various other bits and pieces that will show it is very different version of whatever used to be the case.

We're not in Kansas anymore, Toto.
 
no

while some full doc lvrs are a little better here and there than 6 mths ago, overall the outlook is poor.

Add to that the new legislation that will make it hard for anyone to lend money to someone unless u can categorically verify their income
That's going to make it hard for a lot of people over the next few years
to enter the property market,interesting times..willair..
 
frustrating as i deal in series of capital movements, not regualr income movements (even tho the ATO deem my capital movements as income) - yet I believe these once a year events on your BAS wouldnt qualify as income for the bank?
 
I think they take past tax returns too. My tax return is pretty much useless though, the number on it is always much lower than what I actually get in as I get child support and FTA/B that I don't pay tax on but is around the same amount combined as my taxable income (or it was before I became a landlord) - I don't think the bank takes either of those as income on their own but they will if you declare it as a lodoc. Happy to be corrected though.

Life was simpler for all those years I had a day job with nice regular payslips but got $10 a month child support ...
 
Today my view on credit condition easing or not is that it is wrong to try to identified a trend in that, the matter is too volatile to make any bet on wich direction is going, this at least in Australia.
Who can exclude that if things gets really bad in australia we don't get credit backed agencies like Freddie mac and Fannie may that have a 30 year term mortgage spread at 0.3% with the equivalent government debt?
I believe in US credit condition are going to be harder in the future, this is simply because US government can't throw money at it forever (but as i said australia can be different).
 
As far as BAS goes the banks are looking at sales/turnover and allow upto 40% as your income. If you have huge turnover it is easy to get over the line. I don't believe lending is getting any easier and it's a killer that you can not access equity.

Cheers, MTR
 
Today my view on credit condition easing or not is that it is wrong to try to identified a trend in that, the matter is too volatile to make any bet on wich direction is going, this at least in Australia.
Who can exclude that if things gets really bad in australia we don't get credit backed agencies like Freddie mac and Fannie may that have a 30 year term mortgage spread at 0.3% with the equivalent government debt?
I believe in US credit condition are going to be harder in the future, this is simply because US government can't throw money at it forever (but as i said australia can be different).

I wouldn't bet on Aussie Mac as a saviour. It's already been proposed and Treasury aren't fans for all the obvious reasons
 
I wouldn't bet on Aussie Mac as a saviour. It's already been proposed and Treasury aren't fans for all the obvious reasons

we will see...(couldn't read all the Terrry McCrann crap).
The thing is that Australian's quite don't like what american are doing and quite like the idea of be different from them and rejecting any Fannie and Freddie stuff.
But one day you can have a commodity chrisis and inflation/high interest rates/weak AU$ with that (like in the early 90's), or even the aussie home bubble popping with a gov defict already at 5+%. I think an aussie mac solution could be the best outcome for australians. In any case the AU government is already developing a broadband project without Telstra, they can have a lending project separate from banks too. After all AUS banks monopoly is directings bils$ from home owner towards banks, aussie mac will help to keep money to homeowner and reduce the monopoly of banks.
Also what is the options? government backed bonds to banks again?
 
Non-bank lenders to return: RBA

http://news.smh.com.au/breaking-news-business/nonbank-lenders-to-return-rba-20100412-s325.html

Non-bank lenders to return: RBA
KIM CHRISTIAN
April 12, 2010 - 2:34PM

AAP

Non-bank lenders are likely to return to the market as the economy improves, but lending standards could become more relaxed, the central bank says.

Opportunities were beginning to emerge for smaller players even though there was still less lending activity in the non-banking sector than in the years before the financial crisis, Reserve Bank of Australia (RBA) assistant governor (financial markets) Guy Debelle told a Senate committee in Sydney on Monday.

"I suspect that sector will start to pick up as the economy improves," Dr Debelle told the Senate Economics Reference Committee public hearing on the access of small business to finance.

"I would think we would see increased competition, in large part because we're looking at an economy which is growing pretty well with some pretty good opportunities."

Dr Debelle said "there is a reasonable chance" that lending standards would become more relaxed "if the economic outlook continues to improve", in reply to a question from the committee...
 
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