Latest news with #homeloans
Yahoo
13 hours ago
- Business
- Yahoo
Bank removes ‘roadblock' for homebuyers
National Australia Bank has become the latest lender to ignore some Higher Education Loan Program debt when assessing new home loans. From July 31, NAB says if someone owes $20,000 or less in student debt, it won't affect how much they can borrow should they take out a new loan with the big four bank. This will help lift the borrowing capacity of a potential borrower, as banks consider income, liabilities and outstandings when calculating how much they will give a potential borrower. NAB executive for home ownership Matt Dawson said the change would make a real difference for first-home buyers especially. 'For too long HELP debt has been a roadblock for many Australians looking to buy a home,' Mr Dawson said. 'NAB was pleased to advocate for this change last year which will allow more people to turn their homeownership dreams into reality, faster.' The NAB move is in line with the Commonwealth Bank, which in April said it would exclude HELP debt from home loan serviceability calculations on the basis the applicant could pay off their debt in the next 12 months. CBA also said it was piloting plans for those who could pay off HELP loans over the next one to five years. In February, student debt came into the spotlight when Treasurer Jim Chalmers told the Australian Securities and Investments Commission and the Australian Prudential Regulation Authority (APRA) to update their guidance on how banks should treat student debts. In June, APRA said the changes would come into effect from September 30 2025. While NAB welcomed the move by the regulator to increase buying capacity for homebuyers by clarifying the treatment of HELP debt, Mr Dawson said housing supply remained the most significant challenge. 'It is critical to address both demand and supply-side measures together to help more Australians buy a home. There's no simple fix, solving Australia's housing challenges will take collaboration across the board.' NAB's move comes after the Albanese government announced changes to HELP debt on Wednesday. In its first Bill since returning to office, the government plans to slash 20 per cent off three million graduates' HELP debt. This is the equivalent of $16bn in total relief, according to the government. The move targets HELP debt, VET loans and apprenticeship loans. Calculations released by the government show $5520 would be wiped off the average HELP debt of $27,600 if the legislation passes. The changes would also raise the minimum threshold for student loans to be repaid from $54,000 to $67,000.
News.com.au
14 hours ago
- Business
- News.com.au
NAB removes HECS debt hurdle for mortgage seekers
National Australia Bank has become the latest lender to ignore some Higher Education Loan Program debt when assessing new home loans. From July 31, NAB says if someone owes $20,000 or less in student debt, it won't affect how much they can borrow should they take out a new loan with the big four bank. This will help lift the borrowing capacity of a potential borrower, as banks consider income, liabilities and outstandings when calculating how much they will give a potential borrower. NAB executive for home ownership Matt Dawson said the change would make a real difference for first-home buyers especially. 'For too long HELP debt has been a roadblock for many Australians looking to buy a home,' Mr Dawson said. 'NAB was pleased to advocate for this change last year which will allow more people to turn their homeownership dreams into reality, faster.' The NAB move is in line with the Commonwealth Bank, which in April said it would exclude HELP debt from home loan serviceability calculations on the basis the applicant could pay off their debt in the next 12 months. CBA also said it was piloting plans for those who could pay off HELP loans over the next one to five years. In February, student debt came into the spotlight when Treasurer Jim Chalmers told the Australian Securities and Investments Commission and the Australian Prudential Regulation Authority (APRA) to update their guidance on how banks should treat student debts. In June, APRA said the changes would come into effect from September 30 2025. While NAB welcomed the move by the regulator to increase buying capacity for homebuyers by clarifying the treatment of HELP debt, Mr Dawson said housing supply remained the most significant challenge. 'It is critical to address both demand and supply-side measures together to help more Australians buy a home. There's no simple fix, solving Australia's housing challenges will take collaboration across the board.' NAB's move comes after the Albanese government announced changes to HELP debt on Wednesday. In its first Bill since returning to office, the government plans to slash 20 per cent off three million graduates' HELP debt. This is the equivalent of $16bn in total relief, according to the government. The move targets HELP debt, VET loans and apprenticeship loans. Calculations released by the government show $5520 would be wiped off the average HELP debt of $27,600 if the legislation passes. The changes would also raise the minimum threshold for student loans to be repaid from $54,000 to $67,000.
Daily Mail
14-07-2025
- Business
- Daily Mail
Give more first-time buyers bigger mortgages, Reeves tells finance firms
More first-time buyers could get bigger mortgages, as Rachel Reeves enables lenders to loosen their lending rules to help more people on lower incomes buy a home. The Chancellor is expected to announce the reforms to financial regulation at a summit of top finance executives in Leeds today, ahead of her Mansion House speech in the City of London. Since 2014, lenders have been subject to a rule which means loans of more than 4.5 times the borrower's annual income can only make up 15 per cent of their mortgage book. For example, someone earning £40,000 a year would usually be restricted to borrowing no more than £180,000. This rule now looks set to change with more mortgages being made available at higher income multiples - with some even as high as six times annual salary. On a £40,000 annual salary that could mean being able to borrow £240,000 towards a first home. It follows the Prudential Regulation Authority's recent announcement, enabling lenders to increase high loan-to-income lending. It also follows recent recommendations by the Bank of England that some banks and building societies offer more high loan-to-income mortgages. Labour claims the move will create up to 36,000 additional home loans for first-time buyers over the first year. Nationwide to offer more mortgages at 6x income Nationwide is also set to widen access to its 'Helping Hand' mortgage, which allows some first-time buyers to borrow up to six times their income with deposits as low as 5 per cent. From Wednesday, eligible first-time buyers can apply for the mortgage with a £30,000 salary, down from £35,000, and joint applicants with a £50,000 combined salary, down from £55,000. The building society says the Helping Hand mortgage has been used by more than 57,000 customers since its launch in 2021, and that today's move could enable 10,000 more to get on the property ladder. Nicholas Mendes, mortgage technical manager at broker John Charcol thinks the reforms will help first-time buyers who have struggled to borrow enough to buy a home, despite having a stable incomes and a strong record of paying rent. He said: 'Many would-be buyers have felt locked out of the system, not because they lack financial discipline or reliability, but because the rules haven't kept pace with the way people actually live and budget.' 'Lowering the income threshold for products like Nationwide's Helping Hand mortgage will open the door for thousands more people, especially key workers and young professionals, to get on the ladder.' Mortgage broker Aaron Strutt of Trinity Financial, added: 'It can be really hard for those on lower incomes to borrow anywhere near the amount they need to buy a home, even if they have a large deposit. 'The argument is that they have less disposable income and therefore they can't afford a larger mortgage - even though many of them are paying high rents.' How to find a new mortgage Borrowers who need a mortgage because their current fixed rate deal is ending, or they are buying a home, should explore their options as soon as possible. Buy-to-let landlords should also act as soon as they can. Quick mortgage finder links with This is Money's partner L&C > Mortgage rates calculator > Find the right mortgage for you What if I need to remortgage? Borrowers should compare rates, speak to a mortgage broker and be prepared to act. Homeowners can lock in to a new deal six to nine months in advance, often with no obligation to take it. Most mortgage deals allow fees to be added to the loan and only be charged when it is taken out. This means borrowers can secure a rate without paying expensive arrangement fees. Keep in mind that by doing this and not clearing the fee on completion, interest will be paid on the fee amount over the entire term of the loan, so this may not be the best option for everyone. What if I am buying a home? Those with home purchases agreed should also aim to secure rates as soon as possible, so they know exactly what their monthly payments will be. Buyers should avoid overstretching and be aware that house prices may fall, as higher mortgage rates limit people's borrowing ability and buying power. What about buy-to-let landlords Buy-to-let landlords with interest-only mortgages will see a greater jump in monthly costs than homeowners on residential mortgages. This makes remortgaging in plenty of time essential and our partner L&C can help with buy-to-let mortgages too. How to compare mortgage costs The best way to compare mortgage costs and find the right deal for you is to speak to a broker. This is Money has a long-standing partnership with fee-free broker L&C, to provide you with fee-free expert mortgage advice. Interested in seeing today's best mortgage rates? Use This is Money and L&Cs best mortgage rates calculator to show deals matching your home value, mortgage size, term and fixed rate needs. If you're ready to find your next mortgage, why not use L&C's online Mortgage Finder. It will search 1,000's of deals from more than 90 different lenders to discover the best deal for you. > Find your best mortgage deal with This is Money and L&C Be aware that rates can change quickly, however, and so if you need a mortgage or want to compare rates, speak to L&C as soon as possible, so they can help you find the right mortgage for you.
Yahoo
14-07-2025
- Business
- Yahoo
Major banks slash interest rates despite RBA cash rate hold: 'Not a coincidence'
Numerous banks, including NAB and ANZ, have cut interest rates on term deposit and fixed home loans despite the Reserve Bank of Australia (RBA) holding the cash rate steady. The central bank defied expectations by keeping the cash rate at 3.85 per cent last week, but that doesn't mean lenders aren't moving. NAB cut its term deposit rates today, with decreases of between 5 to 20 basis points across multiple terms. Its 7-month term has been cut by 20 basis points, bringing its leading rate down to 3.80 per cent. Mozo personal finance expert Rachel Wastell told Yahoo Finance the bank was one of 17 banks who had made term deposit cuts following the RBA's decision. RELATED Major banks reveal updated RBA interest rate cut predictions after 'surprise' hold ATO tax return warning for 2 million Aussies over dangerous act Bendigo Bank customers fight against branch closure amid cashless revolution 'When 17 banks, both big and small, slash term deposits within a week it's not a coincidence, it's a signal,' she said. 'Even after the RBA held, the market kept on cutting these forward-looking products, which shows that lenders are most likely preparing for more rate cuts and that the easing cycle is well and truly underway.' Fellow Big Four bank ANZ trimmed its 8-month Advance notice term deposit by 10 basis points on Wednesday, bringing its highest rate down to 3.80 per cent. Other banks that have moved rates downwards include Bank Australia, Judo Bank, and People's Choice. Fixed home loan rates are also falling, with Mozo seeing four lenders cut rates following the RBA decision. On Wednesday, QBANK cut its fixed rates by 20 to 30 basis points, with SWS Bank, Coastline Bank and The Capricornian following suit. Wastell said it was a rate shift and 'both savers and borrowers should take the hint'. 'If banks thought rates were staying put, we wouldn't be seeing term deposits and fixed-rate home loans falling,' she said. 'Fixed rates and term deposits are forward-looking products, so banks adjust them based on where they expect the cash rate (and wholesale funding costs) will go. 'The fact that both big and small lenders are trimming fixed rates across home loans and deposits, even after the RBA paused last week, suggests they're confident further cash rate cuts are coming and want to get ahead of the curve.'The major banks all expect the RBA will cut interest rates at the August meeting. They are then split on how many more interest rate cuts are coming. Here are their current forecasts: CBA: Two more cuts in August and November to bring cash rate to 3.35 per cent Westpac: Four more cuts in August, November, February and May to bring cash rate to 2.85 per cent NAB: Three more cuts in August, November and February to bring cash rate to 3.10 per cent ANZ: Two more cuts in August and November to bring cash rate to 3.35 per cent On a $600,000 mortgage, Canstar calculated two further cuts could see minimum repayments drop by almost $180. If there are four cuts, minimum repayments could drop by up to $350, depending on the timing of the cuts. While further RBA interest rate cuts will be good news for mortgage holders, it has sparked a warning for savers. Wastell told Yahoo Finance the 'window is closing' for savers holding out for a better deal. 'Those peak term deposit rates are already behind us and banks are clearly repositioning for the next phase of cuts. This round of cuts tells us they're betting on more to come, and that even these lower rates won't be around for much longer,' she said. 'If you're thinking about locking in a deposit, now would be the time to move. The banks aren't waiting for the RBA, and the leading rates are only getting lower.'Sign in to access your portfolio
Washington Post
10-07-2025
- Business
- Washington Post
Average long-term US mortgage rate rises to 6.72%, ending a five-week slide
The average rate on a 30-year U.S. mortgage edged up this week, ending a five-week decline in borrowing costs for homebuyers. The long-term rate ticked up to 6.72% from 6.67% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.89%. Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose. The average rate increased to 5.86% from 5.80% last week. A year ago, it was 6.17%, Freddie Mac said.
