ASIC has taken action against Westpac for poor loan assessment practices. There are two consequences –
- If ASIC succeeds, many borrowers who took out interest-only loans will have the law on their side to vary the loan terms to suit their circumstances.
- Not only Westpac but all lenders will restrict interest-only loans, to much less than 2 in 3 investor loans and 1 in 4 home loans that has been the norm up until now.
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