Struggling borrowers will need to consider selling: ANZ

Discussion in 'Property Market Economics' started by Peter2013, 10th Jul, 2020.

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  1. LIDM

    LIDM Well-Known Member

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    Here comes the govt 'HomeKeeper' package ... :D
     
    LIDM, 12th Jul, 2020
    #21
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  2. Property Baron

    Property Baron Well-Known Member

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    Lol - you no longer have to pay for your investment properties. The average punters who do not own a home will "continue" to cover it for you.
     
    Property Baron, 12th Jul, 2020
    #22
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  3. roots73

    roots73 Well-Known Member

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    roots73, 13th Jul, 2020
    #23
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Quite a few lenders have already cranked back on DTIs and reduced LVRs

    A good eg is Mac bank, max 70 % lvr for DTI > 6

    ta
    rolf
     
    Rolf Latham, 13th Jul, 2020
    #24
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  5. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    No surprise there. One of the reasons ANZ has been so popular of late, is their servicing policy was quite generous.
     
    Peter_Tersteeg, 13th Jul, 2020
    #25
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  6. Lacrim

    Lacrim Well-Known Member

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    What was the DTI in the good ol' days?
     
    Lacrim, 13th Jul, 2020
    #26
  7. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Most lenders didn't even use this metric.

    For those that have used it, they've usually had restrictions come in between 6.0 to 8.0. Interestinly it was quite rare to see this metric being the thing that was a restriction, it was usually the 'net surplus figure' that was the roadblock.

    Today I'm seeing the DTI figure being a restriction more often. I think there's a few reasons. Lenders haven't really disclosed exactly how this figure is determined, the methods are fairly vague. They can easily change it without announcing any actual policy changes. Also how they treat it is different. Macquarie don't stop you borrowing when the DTI is over 6.0, but they do stop equity releases. You are still able to purchase with a DTI of 7, you just can't release any equity.
     
    Peter_Tersteeg, 13th Jul, 2020
    #27
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  8. euro73

    euro73 Well-Known Member Business Member

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    cash flow is king. It's why every portfolio should have at least one cash cow in it - as a defensive hedge against injury, illness, incapacity...or in this case, COVID
     
    euro73, 13th Jul, 2020
    #28
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  9. Beano

    Beano Well-Known Member

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    For DTI what is the definition of income

    Gross income
    Gross income less tax
    Gross income after expenses and taxation
    Gross income after expenses , depreciation/capex and taxation
    Gross income after expenses , depreciation/capex , taxation and dividend (if company)
    Includes overseas income
    :oops:
     
    Beano, 13th Jul, 2020
    #29
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  10. Peter2013

    Peter2013 Well-Known Member

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    Peter2013, 13th Jul, 2020
    #30
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  11. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Terry_w, 13th Jul, 2020
    #31
  12. Melbourne_guy

    Melbourne_guy Well-Known Member

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    Could you put that statement into a context as to why it is 'interesting figures' or of significance? Is it near a 'tipping point' at which bad loans pull the entire system down?
     
    Melbourne_guy, 13th Jul, 2020
    #32
  13. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    No significance really. Just interesting to see how many have actually taken up the repayment holiday. I didn't think it was so high.
     
    Terry_w, 13th Jul, 2020
    #33
  14. Melbourne_guy

    Melbourne_guy Well-Known Member

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    Clearly I don't deal in finance, I don't consider 10% as high:D
     
    Melbourne_guy, 13th Jul, 2020
    #34
  15. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I guess the 10% isn't high, but the $266 Billion bit is.

    There must be about $2.6 Trillion in total housing loans out there
     
    Terry_w, 13th Jul, 2020
    #35
  16. lynchy

    lynchy Well-Known Member

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    Am I reading this right in that only 18% of borrowers are making their full loan repayments?

    Borrowers continuing to make repayments: At 30 Apr: Partial Repayments – 13%; Full Repayments 18%. At 31 May: Partial Repayments – 8%; Full Repayments – 12%
     
    lynchy, 14th Jul, 2020
    #36
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  17. The_Billy

    The_Billy Well-Known Member

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    What type of repayments are the other 80% making?
     
    The_Billy, 14th Jul, 2020
    #37
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  18. albanga

    albanga Well-Known Member

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    My comments were not related to investing though but a reply to a comment made that about time this happened.

    Sure if your an investor who relies on CG and NG as a strategy then absolutely stiff biccies. You bought this on yourself.

    But the example I gave is not someone who falls into this category. Majority of people believe the right thing to do is get a good job and pay off debt and there is nothing wrong with that. Sure everyone should have buffers in place for certain situations but this isn’t a certain situation. Anyone who said you should plan for this is taking the ****. I’ll again revert back to a pilot who is basically screwed. If your an international pilot then pretty much your career is over. A return to normal is 5+ years away so you need to start again.

    These people do not fall into the about time category. And I don’t care who any advisor thinks they are but if they think they planned for this they are taking the ****.
     
    albanga, 14th Jul, 2020
    #38
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  19. shorty

    shorty Well-Known Member

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    Back on topic :D

    A comment - this isn't just about investors but home owners as well.

    A question - do we want banks to operate, at least partially, in the public interest or do we accept that they are 100% profit driven?
     
    shorty, 14th Jul, 2020
    #39
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  20. The Y-man

    The Y-man Moderator Staff Member

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    "Public Interest" is pretty complex taken from a stakeholder perspective.

    Keeping in mind that many - a huge number I think - have a vested interest in banks making a profit (think of pretty much anyone who does not actively manage their super fund, holders of ETFs, LICs, and direct share holders).

    So I argue being profit driven is part of "public interest". The key is to do this sustainably (economically, ecologically and socially) so that in essence we do not "kill the goose that lays the golden eggs" - actually, not only making sure it lives, but that it stays healthy and happy. Nothing worse than a depressed goose.

    The Y-man
     
    The Y-man, 14th Jul, 2020
    #40
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