A lot has changed in the investment lending market over the past 12 months. Reviews by several government departments have placed caps on the amount banks can lend to investors in an attempt to slow down housing prices. The effect of these restrictions has been large increses in investor interest rates across the board as banks look for ways to minimize their exposure to investment lending. Some banks will no longer accept applications to refinance investment properties. At this stage with higher rates being a natural deterrant for borrowers most bank's are choosing to go down this path rather than shutting down investment lending all together. A halt to investment lending could well be an option for those banks who cannot keep their investor portfolios under the Government imposed cap.

Interest only loans for both investors and owner occupiers have also come under scrutiny with pressure on banks to restrict the amount of interest only loans as part of their responsible lending obligations. Again the banks have chosen pricing as a deterrent with increases occuring in the market at the moment.

For more information on how this impacts your situation please give our office a call to speak to one of our specialists.