Are credit conditions easing?

Another piece of UK-centric news.

Lloyds (one of the too big to fail British banks) is restricting investment mortgages to cover a maximum of £2 million (about $3.5 million) and three properties.

Details here and here.
 
If I could find a bank to lend me money at 2.5%, they would also have to put a limit on me, because I'd be unstoppable.

What's the rental yield like in England these days?
 
Good luck getting 2.5% for a new mortgage. The banks have widened their spreads, and most loans being offered are around 5%.

I'm not sure what yields are like in general, though there are a lot of prime properties at 4% or so.
 
Graemsay said:
Good luck getting 2.5% for a new mortgage. The banks have widened their spreads, and most loans being offered are around 5%.

I'm not sure what yields are like in general, though there are a lot of prime properties at 4% or so.
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My brother is trying for a loan at 2.5%, he is waiting for the valuation on his existing property to see if he qualifies for that rate. So with equity it is possible.

I wonder if that is more of a throwback to "the rich get richer" mentality in the older countries where if you have more money you can make more money, even at the lower end. Here in Oz the banks have been very reluctant to price risk like that, and when they do it is very minor. Bankwest does 7.3% when you go over 90% LVR, but apart from that it is quite rare. And even that is only .6% point increase, whereas you're talking about 2.5% points, or DOUBLE the interest in absolute terms.

Interesting. I think this is the direction we're heading, with 95's and lo docs being priced higher, but it hasn't really happened yet especially at the big end of town, those doing 90% of the mortgages at the moment.
 
I've heard that if you want one of the really juicy mortgage deals then you need to have 40% equity. So if you've held property for a while then it's possible.

My guess is that either the banks are pricing in the risk of a housing market collapse, or they need to offer low rates to those with decent equity in order to win business. (Someone with a relatively low mortgage is probably on a good rate from before the credit crunch.)
 
HOME owners are being offered bigger discounts on increasingly large mortgages as banks seek to breathe new life into the lending market.
...
major lenders have loosened the limits on the percentages of the total amounts they are prepared to advance with a deposit. The limits were cut to as low as 80-85 per cent after the global financial crisis as borrowers were required to contribute more of their savings.
...
Commonwealth Bank, has increased its loan-to-valuation ratio from 90 per cent to 95 per cent, according to the latest research compiled by Deutsche Bank.
Click to expand...

More here: http://smh.domain.com.au/real-estate-news/banks-battling-for-big-borrowers-20110530-1fbec.html
 
Got an approval yesterday from Suncorp.
Let me leave only 5% equity in current place to fund the next one!

Pretty happy with that!
 
aussierogue said:
Yes they are but the government spin doctors dont want the general public to know it.
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Spoke to our PM over in the West yesterday. They have had 15 sales fall over in the last month due to no finance approval.

Now, THAT is a lot.

My MB here in Melb says the same - lots of enquiry, but few deals getting over the line.
 
Home loan rate cut for Commonwealth Bank...

http://www.news.com.au/money/intere...for-commonwealth/story-e6frfmn0-1226082513213

The Commonwealth announced it had reduced the rate on its no-fee home loan by 13 basis points to 7.11 per cent.

The new rate - equivalent to a $27 per month saving on the average mortgage - applies automatically to all new and existing no-fee home loans.

The bank launched the cut-price no-fee home loan in late February. The home loan is priced significantly below the standard variable rates offered by all the other major banks.
Click to expand...
 
Commonwealth Bank is now offering loans to temporary and overseas residents.

They can even pay in foreign currency.

http://www.commbroker.com.au/Net/Do.../update-2011/June-2011/update-june-230611.pdf

Effective Monday 27 June 2011, we will be updating our Foreign Income and Eligible Borrower policy.

We are expanding the eligible borrower policy to accept applications from the following new customers for Owner Occupied or Investment Home Loan purposes:

Temporary Australian residents holding a current 457 VISA living and working in Australia (a copy of the 457 VISA must be included in your supporting documents)

Permanent Australian Residents living and working overseas.
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I have a proerty for sale here and have had great interest over the last 4 months but come hell or high water the 8 interested buyers we have had not one of them could get finance. All ages all different stages of life and employment. Not one interested party has offered lower than our asking price, so cant be that.
i am at a loss as to why.
cheers
 
yadreamin said:
I have a proerty for sale here and have had great interest over the last 4 months but come hell or high water the 8 interested buyers we have had not one of them could get finance. All ages all different stages of life and employment. Not one interested party has offered lower than our asking price, so cant be that.
i am at a loss as to why.
cheers
Click to expand...

lower your price a bit and make the sale unconditional, ie not subject to finance.

If someone signs it wont be your problem.

I have never offered a property subject to finance.
 
Shaddow I saw that announcement from BW this morning. I'm wondering how this differs from most of the other lenders that already offer 95% loans with capitalised LMI (in effect 97% or more).

I could call BankWest and find out, but frankly I'm a bit fed up with their attrocious service, draconian policies, inconsistant messages and products that bite you 2 years down the track.

BankWest has consistantly burnt customers for 4 years running now and I don't seen anything changing in the future. They do have a certain nieche, but I simply don't trust them.
 
Greater Building Society does 95% LVR loans (LMI capitalised) and very competitive interest rates (variable 6.94%, 1-year-fixed 6.59%). We just got one without any hassle and they were by far the easiest and friendliest to deal with I have come across. I think they only do NSW and QLD.
Cheers Ali
 
ali said:
Greater Building Society does 95% LVR loans (LMI capitalised) and very competitive interest rates (variable 6.94%, 1-year-fixed 6.59%). We just got one without any hassle and they were by far the easiest and friendliest to deal with I have come across. I think they only do NSW and QLD.
Cheers Ali
Click to expand...

xcept try and get IO variable on PPOR and offset..................ouch that can be an expensive lesson as one of our clients found recently.

Sometimes the detail cost a lot more than the apparent ease or saving.

ta
rolf
 
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