Line of credit mortgages fading away

According to the latest data from the Australian Bureau of Statistics, the amount of Australian home owners drawing upon revolving lines of credit for their mortgage has fallen to a 13 year low.

In November, 2011, only 3.7 per cent of home loans were revolving line of credit – the lowest number since May 1998 – well down on the 10.2 per cent recorded in December 2005.

Loan Market Group’s chief operating officer Dean Rushton says, “Consumers are using other products with redraw facilities or offset accounts should they need extra money. These products are often free of any additional fees.”

Source: The Adviser