Banks vs. non-banks

With competition on the rise between lenders, borrowers should look beyond the major banks to see how a mortgage broker can assist.

Competition is again heating up between the banks and non-banks as liquidity returns to the lending market.

When times were tough during the global financial crisis, borrowers turned to the safety of the majors. Government backing of the banks was enough to convince most borrowers that they were in safe hands with the major financial institutions.

But times have changed. Today it is the major banks that are coming under government scrutiny when most lenders pushed their mortgage rates up by as much as 0.2 per cent above the Reserve Bank’s November rate rise.

Non-bank lenders have seen an opportunity to win back the borrowers lost to the banks in previous years and in many instances they have provided competitive rates.

But it is not interest rates alone that have prompted borrowers to look beyond the banks.

Self-employed, credit impaired borrowers and business owners that have been turned away by the banks have often found their business welcomed by the non-bank sector.

So when you are looking for the right lender for your situation, mortgage brokers are a great point of call when it comes to looking across the full spectrum of products.

We are not only able to find the most competitive rate but we can also help you evaluate the suitability of the product and the lender. We listen to your needs.

Source: Mortgage Finance Association of Australia