APRA To Loosen Home Loan Rules
If you’ve been struggling to secure a home loan, there’s a glimmering light at the end of the property market tunnel.
The Australian Prudential Regulation Authority (APRA) has plans to lower the minimum interest rate serviceability buffer from 7 per cent to a level determined by banks and other lenders.
Market experts anticipate that if these plans are implemented, more Australians are likely to take out loans and get bigger mortgages, since the change could increase people’s borrowing capacity – which is great news for aspiring Kingslea homeowners!
For the past four-and-a-half years, APRA has required banks to test potential mortgagors against either an interest rate of 7 per cent, or a 2 per cent “buffer” over the loan’s actual interest rate, to ensure they could meet repayments if rates rise.
Cameron Kusher from CoreLogic said the proposed APRA changes “will help some borrowers that can’t quite access a mortgage currently to get one”.
For more information on these exciting plans for change, click here.