Commonwealth Bank confirms $33,000 home loan change for these Aussies: ‘Lower deposits'
Commonwealth Bank will make it easier for Aussies looking to build their own home to get onto the property ladder with a smaller deposit. The country's biggest bank will increase the maximum loan-to-value ratio (LVR) for its construction loans later this month.
CBA currently allows customers to borrow up to 90 per cent for securities valued under $3 million and up to 75 per cent for those valued between $3 million and $5 million. From May 24, the major bank will increase the maximum LVR to 95 and 80 per cent respectively for construction loans, while raising the maximum security for the top bracket to $6 million.
CBA executive general manager home buying Dr Michael Baumann told Yahoo Finance the major bank was committed to helping Australians realise their property ownership goals.
RELATED
Commonwealth Bank issues RBA interest rate cut warning for mortgage holders
Superannuation change to give Aussie workers pay rise in weeks: '$29,000 boost'
ATO warning over Centrelink payment as 82 per cent of Aussies get it wrong
'Our expanded construction loan policy is designed to create more opportunities for Australians interested in building their property to achieve homeownership sooner by allowing them to access construction finance with lower deposits,' he said.
The average construction loan in Australia was $674,649 for new builds in the December quarter, according to Australian Bureau of Statistics data.
Under the previous rules, a 10 per cent deposit would have been $67,474.90.
Now the requirement for a 5 per cent deposit halves that deposit amount to $33,732.40.CBA has made a range of changes to its home loan rules in recent months, including offering loans for prefabricated home builds.
Prefab homes are constructed off-site, mostly in a factory, and then transported to the individual's desired location, making them a cheaper option than traditional housing.
'Prefabricated homes have historically been difficult to finance in Australia,' Baumann told Yahoo Finance.
'Our prefab housing policy update allows customers to access progress payments before the property is affixed to land (up to 60 per cent of the total contract price), instead of requiring them to fund up to 90 per cent of the upfront costs themselves as has previously been the case.'
CBA has also announced it will remove HECS loans during serviceability assessments if the debt will be repaid within 12 months.
Other changes include allowing first-home buyers to rent out a room and use the rental income to help service their home loan. Customers can count up to $150 per week in servicing, with one renter allowed.
It is also piloting an expansion to its LMI waiver program to include more workers like paramedics, firefighters and nurses.
CBA economists expect the Reserve Bank of Australia (RBA) will cut interest rates at its upcoming May meeting, despite inflation figures coming in a touch higher than it had expected.
The major bank has forecast three interest rate cuts this year in May, August and November, which would bring the cash rate down to 3.35 per cent.
Westpac, ANZ and NAB are also expecting a May cut, with NAB predicting a double 0.50 per cent cut.Sign in to access your portfolio
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
3 hours ago
- Yahoo
Another clue drops as frantic hunt for Powerball $100 million winner intensifies: 'Could be a tourist'
More than a day after the life-changing numbers were drawn, Australia's newest multimillionaire is still a mystery — and officials are desperately urging Powerball players in Sydney's east to check their tickets immediately. One ticket, purchased at Bondi Junction Newsagency & Internet Café on Oxford Street, holds the sole division one winning entry from Thursday night's $100 million Powerball draw 1517. But with no registered player details linked to the ticket, The Lott still has no way of contacting the winner — and can only wait, and hope, that someone soon realises they've become one of the country's richest individuals. "With a winning entry tucked away in their car, wallet, or stuck on their fridge door, one New South Wales player is walking around completely oblivious to the fact their life has forever changed," The Lott spokesperson Eliza Wregg said. "There are 100 million reasons why Sydney's eastern suburbs players should check their tickets today.' The winning numbers drawn Thursday, June 12, were 28, 10, 3, 16, 31, 14 and 21. The Powerball number was 6. For Bondi Junction Newsagency & Internet Café, the news is already legendary. "Wow. It's legendary to hear we've sold the winning ticket in Thursday night's Powerball draw worth $100 million," said store owner Manish. "This is by far the biggest winning entry we've ever sold. The team are thrilled to hear the winning news. I'll be rewarding the particular staff member who sold the winning ticket, too. I'm hoping it's one of our regular customers, but you never know — it could be a tourist too. We're located right next to the closest station to Bondi Beach, so you never know." The Lott confirmed that this is the only Division One winner nationally in draw 1517, meaning just one lucky ticket holder is entitled to the entire nine-figure prize. $100 million Powerball winner reveals how her life has changed How $100 million Powerball winner can best spend their jackpot Powerball $100m draw: What really happens when you score "Imagine discovering you're suddenly a multi-millionaire! You could immediately retire, take the trip of your dreams, or spoil those nearest and dearest to you," Wregg added. "All you need to do is visit scan your ticket on The Lott app or visit one of our friendly retailers to find out if you are our division one winner." If the winner comes forward, they'll join the ranks of Powerball royalty. Last year alone, 21 Australians shared in over $773 million worth of division one prizes — including a record $150 million win by a single Adelaide man. Until then, the nation waits — and watches — to see who will step forward to claim one of the biggest lottery prizes ever handed out in Australia. Do you have a story tip? Email: newsroomau@ You can also follow us on Facebook, Instagram, TikTok, Twitter and YouTube.
Yahoo
4 hours ago
- Yahoo
The case for the Fed holding interest rates at June meeting
Federal Reserve officials will be convening in Washington, D.C, next week for their June FOMC meeting, starting on Tuesday and concluding on Wednesday with a press conference with US central bank's Chair Jerome Powell. Yahoo Finance senior reporter Allie Canal explains how investors will be listening closely for whether the Fed will cut interest rates at this meeting. Inflation and the lasting price pressures from President Trump's tariffs continue to weigh on consumers. Also watch Yahoo Finance's Jennifer Schonberger outline what to expect from next week's Fed meeting and the Trump administration's commentary around the central bank. To watch more expert insights and analysis on the latest market action, check out more Market Domination here. The Federal Reserve is expected to hold rates steady at next week's policy meeting, although nearly 70% of investors now believe cuts could come by September, and some are even betting on July. Still, uncertainty remains, especially around the scope of President Trump's tariffs, which continue to ripple through markets. Some duties have been paused, but many remain in place, and we still don't have a firm deal with China, which is one of our largest trading partners. All of that complicates the Fed's outlook, and we did have the chance to speak about this with Wall Street watchers this week, including a former Fed president. Take a listen. The high level of uncertainty still is with us. And that, I think, is why the Fed is on hold until some of that, we get a little more clarity about not only the magnitude of the tariffs and the breadth of the tariffs, but what effect they'll have on inflation and what effect the tariffs and other policies, including the, the budget bill, will have on growth and employment. The Fed is going to stay on the sidelines, which means we're kind of in this wait and see time period, and that's where I don't think the Fed likely cuts until September, unless you see significant weakening in the labor market. And then the question is always, is it too late or not? The benign version of rate cuts, I think, will take time to develop because the Fed will want to have confidence that, number one, prices aren't rising in a kind of uncontrolled fashion, and at the same time, you know, the Fed will be monitoring the activity signals in the economy as well. So, for now, the general consensus is that the Fed is staying cautious, encouraged by the data, but waiting for clearer signs before making any significant moves. And we'll be watching closely for what comes out of the updated dot plot as well, which will give us more of a sense into how the central bank is thinking about future interest rate cuts.
Yahoo
4 hours ago
- Yahoo
Trump's busy weekend: Military parade, G7 summit, & more
It's a big weekend for President Trump: On Saturday, the US military parade will celebrate the US Army's 250th anniversary, coinciding with Flag Day and President Trump's 79th birthday. This Sunday, the G7 summit will begin in Canada. Yahoo Finance Senior Reporter Jennifer Schonberger joins Market Domination Overtime with Julie Hyman to discuss the details. To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here.
