Loan applicants continue to be haunted by poor credit card decisions, even though national credit card debt is slowing, Melbourne broker Marios Rokka says.
Rokka says he’s seen many home loan applications adversely affected by clients who accepted seemingly innocent credit card limit increases.
“Automatic credit card increases are common these days, but [they] can have a big impact on your borrowing power, especially when you don’t use the limit you have been granted,” he says.
Rokka’s observations follow reports that the value of national credit card debt has fallen from more than $50bn last year to $48.7bn.
The availability of debit cards, where users spend their savings rather than relying on credit, and technology changes have been lauded as reasons for the shrinking credit card debt.
Rokkas points out that a $10,000 credit card limit, for instance, can reduce a person’s borrowing limit by up to $30,000.
“When you’re going through a home loan application, lenders are going to look closely at your savings and income, but they also place a huge emphasis on the amount of credit you have available, which could potentially affect your ability to make future repayments.”
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now
Top Suburbs :
Get help financing your investment
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local expert Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus, our mortgage broking service is at no cost to you.
We value your privacy and treat all your information seriously - you can check out