Rising cost of living halts loan interest

Rising cost of living halts loan interest

Loan applications have slowed down at banks in recent months amid the cost of living and the interest rate rises which are now at 6% on average.

Community Bank Mount Gambier and District branch manager Emma Horrigan said customers were very concerned with rising home loan rates as borrowers had enjoyed historically low rates for so long.

“The steep increases have resulted in customers looking at their home loan differently,” she said.

“For most of us our home loan is our largest debt and we need to ensure that our focus is being able to make repayments.

“We are finding buying that new car or going on that holiday is becoming not as much of a priority.

“Our personal spending is slowing down while we readjust to the currents rates that are on offer and the ongoing cost of living and the sting of the cost of our everyday items.”

Ms Horrigan said initially their first home buyer applications decreased amid the interest rate hikes.

“We continue to work with them (first home buyers) and assist with increasing their deposits by reviewing their savings on a regular basis and ensuring they are taking advantage of the high interest earning accounts that we currently have on offer,” she said.

“Recent changes regarding stamp duty being abolished in South Australia for first homeowners will also boost their initial deposit.

“We are currently offering First Home Guarantee, Family Home Guarantee and Regional First Home Buyer Guarantee government schemes to allow eligible first home buyers to purchase their first home with as little as 5% deposit.

“Our point of difference being our Community Bank story so wanting to bank local, our lenders are local and available in branch.”

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