Borrowers Coping Well
More than $350 billion worth of home loans are expected to move from fixed to variable rates in the coming months. Despite predictions it will result in higher levels of loan arrears, major banks report owners are still coping well. Bendigo and Adelaide Bank CEO Marnie Baker says they are not seeing “material” signs of borrower distress in regional or urban areas. Its number of loans 90 days in arrears has risen slightly to 0.46% and remains close to historical lows.
“Borrowers remain in good shape with 41% of loans at least one year ahead on repayments and 31% of loans two years ahead on repayments,” she says. Commonwealth Bank has $52 billion of mortgages transitioning off fixed rates in the second half of this year. Only 0.43% of its loans are in arrears more than 90 days. Sebastian Watkins, of Aussie Home Loans, says the transition will result in a significant amount of financial pain and stress for Australian mortgage holders.
More than $350 billion worth of home loans are expected to move from fixed to variable rates in the coming months. Despite predictions it will result in higher levels of loan arrears, major banks report owners are still coping well. Bendigo and Adelaide Bank CEO Marnie Baker says they are not seeing “material” signs of borrower distress in regional or urban areas. Its number of loans 90 days in arrears has risen slightly to 0.46% and remains close to historical lows.
“Borrowers remain in good shape with 41% of loans at least one year ahead on repayments and 31% of loans two years ahead on repayments,” she says. Commonwealth Bank has $52 billion of mortgages transitioning off fixed rates in the second half of this year. Only 0.43% of its loans are in arrears more than 90 days. Sebastian Watkins, of Aussie Home Loans, says the transition will result in a significant amount of financial pain and stress for Australian mortgage holders.