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Banks ease credit policy

by Staff Reporter8 minute read
The Adviser

Staff Reporter

Australia’s banks are beginning to loosen their credit criteria; Smartline’s managing director Chris Acret has claimed.

According to Mr Acret, the banks are now looking favourably at a variety of income types when considering home loan applications.

“While overtime, bonuses and second jobs used to be regularly accepted by lenders, unfortunately this changed when the GFC hit,” he said.

“Those with casual or contract employment or who were self-employed also found it much more difficult to secure home financing as banks became very risk adverse.

“Thankfully, lenders are increasingly ‘normalising’ their lending criteria and while we haven’t yet returned to pre-GFC levels, it’s moving in the right direction.”

Mr Acret said lenders were now considering the income of a person working in a temporary, casual or contract position after three months, particularly if they work in certain roles, such as an accountant, teacher, nurse or engineer.

“The full-time position that was guaranteed for life is slowly becoming less and less relevant as both employers and employees look for greater flexibility in the workplace and in their lives,” he said.

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