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It’s getting harder to borrow.
In this month’s newsletter we look at the effects the Royal Commission has had on the lending market.
In recent months the cost of wholesale funding in the Australian market has increased.
Whilst the Royal Commission has been focused on the consumer lending market, the impacts of it have certainly been felt in the commercial space. With increased focus on privacy, anti-money laundering, and suitability of loans, the commercial space has also been impacted by the increased compliance work meaning, much slower turnaround times and a conservative approach to risk. In the last week alone multiple major lenders have announced policy and product changes including:
- withdrawing from SMSF lending
- limited appetite on commercial property investment
- interest rate increases
Tougher scrutiny on loan applications
In a recent AFR article (31/07/18) Christian Beck – ranked 99th on this year’s financial review Rich List, and worth an estimated $775M, was unable to secure a loan between $4-6M after trying for 4 months with his encumbered bank, CBA. The tightened APRA rules mean assessment is a lot tougher than it used to be but banks’ policies do vary so it helps to know where to place the deal when the finance need arises.
If you are currently in the market for finance, it is imperative that you are matched with a lender who will support your individual circumstances. Most buyers and clients looking to refinance focus solely on the rate which, whilst very important, cannot be the only driving factor. Barbara Duvnjak, Manager, Finance Broking explains how “GSA works with over twenty lenders and can match you with the right lender, product and rate.”
GSA focuses on the borrower, “we want to make sure that your deal is placed with a lender who has appetite for your transaction and we will ensure that the rates we negotiate for you are market leading", Barbara explains. We will manage the transaction for you from start to finish and ensure that you continue to get the service post settlement.”
Speak to GSA for a no obligation quote.
Written by Barbara Duvnjak
Manager, Finance Broking