Join Australia's most dynamic and respected property investment community

Do the new APRA conditions apply to Commercial loans?

Discussion in 'Property Finance' started by Blacky, 22nd Jul, 2015.

  1. Blacky

    Blacky Well-Known Member

    Joined:
    25th Jun, 2015
    Posts:
    1,104
    Location:
    Bali
    With all the talk about the new APRA conditions just wondering if it applies to Commercial or un-regulated loans (non-consumer)?

    Cheers

    Blacky
     
  2. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

    Joined:
    14th Jun, 2015
    Posts:
    2,120
    Location:
    Sydney & Adelaide
    Comm is under 80% lvr anyway so not much change
     
  3. Blacky

    Blacky Well-Known Member

    Joined:
    25th Jun, 2015
    Posts:
    1,104
    Location:
    Bali
    What about in regards to the servicing models?
     
  4. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,109
    Location:
    Melbourne, Nationwide
    I don't think I've heard anything anywhere in regards to commercial lending and APRA comments. Commercial lending is unregulated, it may not even come under APRA's umbrella (not sure about this).

    Given the overall economic state, I would hope that the government is going to do whatever they can to promote business, and by association, commercial lending.
     
    Last edited: 22nd Jul, 2015
  5. Redom

    Redom Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    863
    Location:
    Sydney (West) and Canberra
    Policy mix from regulators right now will be doing what they can to promote commercial lending! :)

    Growth in commercial lending is one of the key indicators to what policymakers are trying to do and an early indicator for improved overall economic performance (reflective of business confidence).
     
  6. Chilliblue

    Chilliblue Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,579
    Location:
    Australia
    None of my clients have been affected and the reason is as DaveM pointed out. Comm lending requires higher deposits to residential.
     
  7. TaylorChang

    TaylorChang Well-Known Member

    Joined:
    2nd Jul, 2015
    Posts:
    167
    Location:
    Sydney
    APRA didn't touch commercial and business lending.
    DSCR still around 1.5%, assessment rate is around 7.5% depending on the sectors and business.
    I have to say commercial is totally different from home loan, it took me a long time to make a deal........ but I have to say it was a lot of more fun to do.

    However, I heard there are some talks within ANZ about tightening in property development sector in the commercial lending area.
     
  8. MTR

    MTR Well-Known Member Premium Member

    Joined:
    19th Jun, 2015
    Posts:
    7,497
    Location:
    Perth, Melbourne, USA
    This is certainly going to change things dramatically, and I thought they would never get rid of lo doc/no doc, but it happened, now more hardship for investors.

    MTR
     
  9. Harry Goyal

    Harry Goyal Member

    Joined:
    22nd Jul, 2015
    Posts:
    8
    Location:
    Victoria
    APRA lending rules are only applicable on home loans, the focus is basically to handle the housing bubble
     
  10. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,173
    Location:
    Adelaide, SA
    No push in this area thankfully - which may mean that some investors may want to consider transitioning from residential lending to commercial as there portfolio grows and serviceability becomes more constrained.
     
  11. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    No changes to comm loans or business loans or development loans over 5+ as it be a NON NCCP loan....not regulated.

    So recently we have seen a spike in comm loans.