Thousands of homeowners are stuck in a “mortgage trap” with the major banks leaving them unable to refinance their loans to get a better rate.
Changes in bank rules around living expenses calculations have effectively wiped huge amounts off the maximum a bank will allow you to borrow.
Many people are now finding they originally borrowed more than a bank would lend them under current conditions, meaning they haven’t got the option of shopping around to get a better interest rate.
Lending criteria has been tightened in the past year so no bank will lend them the amount they need. The ongoing Banking Royal Commission is likely to tighten the criteria even further — meaning people will be able to borrow even less than they once did.
With homeowners unable to shop around, they can be stuck with a major bank paying a high interest rate, which will leave them potentially paying thousands more over the life of a loan.
At Craig Tracey Lending we will find you the best deal on your home loan with the smaller banks. And if you don’t have the borrowing capacity to change, we give you tips on getting the lowest interest rate from your current bank.
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