Citibank Reduces Equity and cash out loans for investors

Posted Monday, 17 August 2015 at 14:57 by Shape Home Loans
Tagged: Loan for investment | APRA lending laws | Loan for investor | Equity Release | Cash out
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Banks are starting to reduce the amount of cash out/ equity you can draw out from your property

This follows the move made by ING 1 month ago where they banned cash out/ equity on investment properties.

http://www.shapehomeloans.com.au/blog/ing-new-investment-lending-policy-no-more-cash-out-equity-and-no-more-discount-for-new-investment-loans-20150729179

Citibank has made a move to limit the amount of cash out/ equity you can take out.

For loans under $500,000 ( at 80% LVR) - Cash out/equity is limited to maximum 5% of the refinance loan value.

For loans over $500,000 ( at 80% LVR) - No restrictions ( YET)

Example: Maximum 5% cash out equity.

Current Property value: $600,000

Current loan: $350,000

Normally we can take out 80% of the property value: So $600,000 x 80% = $480,000 loan

Minus your current loan ( $480,000- $350,000) = $130,000 equity.

Under this new 5% maximum, the equity will only be $17,500.

Our advice. Take out as MUCH equity as you can NOW!

Limit on cash out will be standard across ALL banks very soon, as banks find ways to meet their capital cash requirement due to the APRA lending laws.

Contact a Shape Home lons advisor today (No charge). 

Phone: 1300 74 5626

Email: info@shapehomeloans.com.au Or clik here to drop us a note.

Visit our customer service center: 5 Belmor street, Burwood NSW 2134.