I am looking forward to seeing how this actually pans out. Lots of hype but I'm not convinced.
Given the current down turn in Sydney and Melbourne property markets, there is much less demand for new IO loans.
Banks have a cap of 10% annual growth in their IO loan books.
If a loan comes off IO, that reduces their loan book, so resigning the same loan for a further IO period does not grow their IO book at all.
But based on current facts. Why would these borrowers not be offered new IO loans?
Probably why the RBA is not concerned.
Yes I know the RC is going to cause lending to get tighter but as yet that has not occurred so any impact of what the new rules may or may not be is speculation. Which actually makes a good point for anyone in this situation, refinance before the RC makes their recommendations on what they think should be changed. No guarantee the gov will implement them but thats a story for another thread
