Home loan

Borrowers with small deposits are more likely to extend their mortgage deferral


Reaching less than 5% of total deferrals in September, in October 90% or more of LVR borrowers accounted for 10% of the deferred loan portfolio, implying that they were more likely to request extensions than those with deposits more important.

In the broader market, those with an LVR of 90% or more accounted for just 6% of the total loan portfolio, according to the Australian Prudential Regulation Authority (APRA).

This is a higher ratio than in June, when 90% or more borrowers accounted for 5% of the loan portfolio and 8% of deferred loans.

APRA does not publish data on the proportion of specific risk profiles who reinstate or extend their home loan deferrals.

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Basic criteria: a loan amount of $400,000, variable, fixed, principal and interest (P&I) real estate loans with an LVR (loan-to-value) ratio of at least 80%. However, the “Compare mortgages” table allows calculations to be made on the variables selected and entered by the user. Certain products will be marked as promoted, featured or sponsored and may appear prominently in tables regardless of their attributes. All products will list the LVR with the product and price list which is clearly published on the product supplier’s website. Monthly repayments, once the basic criteria are modified by the user, will be based on the advertised prices of the selected products and determined by the loan amount, the repayment type, the loan term and the LVR as entered by the user. user/you. *The comparison rate is based on a loan of $150,000 over 25 years. Please note: this comparison rate is only true for this example and may not include all fees and charges. Different terms, fees or other loan amounts may result in a different comparison rate. Rates correct as of October 8, 2022. See disclaimer.

As of October 31, $88 billion in loans were deferred, representing only 3.3% of banks’ total loan portfolios.

Outflows also exceeded new inflows for the fourth consecutive month, totaling $100 billion in loans expiring or exiting deferral, and only $12 billion entering or being extended.

Indeed, up to half of borrowers canceled their six-month deferral in early October.

In August, borrowers at 90% and above LVR from CommBank held a 13.5% share of total deferred loans, a figure that jumped to 15% in October.

Newcastle Permanent also held a 24% share in the 90% and above LVR Deferred Loans.

Bendigo and Adelaide Bank also had the highest share of deferred interest-only loans at 21%.

For investor lending, 86% of Regional Australia Bank’s investor lending was deferred.

Photo by Jonathan Francis on Unsplash


The whole market has not been taken into account in the selection of the above products. Instead, a reduced portion of the market was considered. Products from some vendors may not be available in all states. To be considered, the product and price must be clearly published on the product supplier’s website. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au and Performance Drive are part of the Savings Media group. In the interest of full disclosure, Savings Media Group is associated with Firstmac Group. To learn how Savings Media Group handles potential conflicts of interest, as well as how we are paid, please visit the website links at the bottom of this page.

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