Credit Problems

Reading the headlines you’d think that the property prices could drop off a cliff anytime soon. This is after the same newspapers screamed out that the market was booming. That property price increases priced first home buyers out of the market.

Articles often supported by some statistics to support the theory that the “market” is dropping. It’s enough to make anyone think it’s wise to stay out of the market or even to sell out of it.

The evidence is that the market is softening. This is caused by multipile factors including a credit squeeze making it more difficult for people to access the credit they need for property or business purposes. One of the biggest issues putting pressure on house prices is the banks have changed their approval policies after being slammed at the Hayne Royal Commission.

This means the your current lender may not be the best people to go to for a refinance or new purchase. It is important to not only look at rate when determining a suitable loan product. Look also at the credit policy of individual lender’s. There is little point going to the trouble of applying for funding with a lender that has changed policy. It may preclude your approval in your current circumstances.

Its more important than ever to research the lenders and loan products available. We are not just experiencing pricing pressure in this current property cycle, we are experiencing a credit problem. Normally in a downwards phase of the property cycle we see confidence levels drop creating pressure on property prices. We now face a quite unique situation of people confident enough to purchase a property or invest in business but are then confronted with a credit problem as they encounter the new policies.

In this cycles, as in others, there will be opportunities as well as challenges. Opportunities for those that do their research.

Check out our website which lets you compare potential lender’s using our robot assistant. Order a free property report which will show you an estimated price of property and suburb.




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