Online lender welcomes first home buyer policy

Leading online lender loans.com.au has welcomed the Federal Government’s focus on smaller and non-bank lenders in its recently announced deposit assistance scheme for First Home Buyers.

Managing Director Marie Mortimer said the scheme would make a big difference for first home buyers who needed to get into a home quickly.

She said that, just as importantly, it would foster much-needed competition for the big banks in the mortgage market.

“Australia’s home lending market is excessively dominated by four massive banks so wherever possible the Government’s policies need to be aimed at boosting competition for consumers,” Ms Mortimer said.

“This scheme has the potential to achieve that by encouraging first home buyers to use lenders outside the big banks for their first mortgage. That means they will be more likely to keep using smaller lenders in the future if they upgrade or buy an investment property.” 

In his speech announcing the Coalition Policy, Prime Minister Scott Morrison said the scheme would give “preference to working with the smaller banks and the non-bank lenders to boost competition”.

The scheme follows a raft of other government policies to boost banking competition, including measures to make it feasible for non-ADIs to acquire ADIs and for new entrants to get a banking licence after decades where no new licenses were issued.

Ms Mortimer said loans.com.au had already taken steps to help First Home Buyers access finance, such as easing the required Loan-To-Value Ratio (LVR) for its cut-price Essentials Home Loan from 80% to 90%, meaning that only a 10% deposit is now required.

“We are very committed to helping First Home Buyers achieve their dreams of home ownership and if the Government gives us an opportunity, such as this deposit assistance scheme, we will take the ball and run with it,” Ms Mortimer said.

“The public has shown they are ready to give smaller lenders a chance and it is great to see that the Government and Opposition are willing to take concrete measures to make that happen.”

Media contact: Duncan Macfarlane| 0434 184 264

About loans.com.au

Founded in 2011, loans.com.au has grown to become a leader in online lending with thousands of happy customers in every state and territory. Loans.com.au is backed by the financial strength of our parent company Firstmac, which is Australia’s largest non-bank lender. Firstmac has been operating successfully for 39 years and it has almost $11 billion in mortgages under management.