Arrears on unconventional home loans 20 times worse than normal

The Reserve Bank said that 40 per cent of people seeking “non conforming” home loans have “impaired credit histories”, while lending by banks under low-doc loans require no proof of income or repayment ability. The RBA said the level of home loan arrears on non-conforming loans at the end of 2004 was nearly 4 per cent of all such loans, compared to only 0.2 per cent of banks' housing loans.

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