Suncorp have this morning become the latest lender to issue lodoc changes which could eventually see the end of the lodoc market as we now it:
This update is due to the adjustment of the Low Doc lending criteria as follows: 1. The primary income earner must be self-employed.2. No debt consolidations will be accepted.3. Only allow refinances of prime loans from the four major banks (ANZ, Commonwealth Bank, NAB and Westpac) and other selected Australian Deposit-taking Institutions (St.George, Bank SA, BankWest, Bendigo Bank, Bank of QLD, HSBC, Citibank, Newcastle Permanent, Heritage Building Society, Credit Union Australia, The Rock, and Police and Nurses Credit Society). This change aims to limit any potential acquisition of sub-prime or no-documentation style lending.4. Cash outs or loan advances where Suncorp cannot control funding will be limited to the lesser of 10% of the loan amount or $50k.5. The maximum loan amount and applicants’ total borrowings cannot exceed $1.5m (previously $3m). These changes will take effect 1 November 2008.
Richard Taylor | Australia's leading private lender
Hi Richard
There have been some big changed within finance over the past year. No Doc loans have vertually disappeared and now Low Docs. Any one with a bad credit history is having a very hard time. Many or most of the small private type lenders have disappeared. It is very hard, if not impossible to get a loan for development based on end value.
Many people have short term loans which will need to be refinanced within 1 or 2 years. Many of these are maturing soon.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Totally agree with you Terry.
How the landscape has changed over the last 6 months. Imagine what the next 6 will look like.
Bit like when i first started out in the 80's with the risk V rate prefice.
Richard Taylor | Australia's leading private lender
Certainly I can feel it in Sydney's market.. as small developers are trying hard to offload their excess equity…
Love to see mortgagee in sale.. Well… time to punish the spruikers and their associates…I think the falling in property price especially high rise development.. will have some delay ie. 12 months after financial crisis.
Good to sit back with CA$H and watch… plus cherry pick if necessary
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