Leading mortgage broker Mortgage Choice expects more Australian domiciliate lenders to raise interest rates as a result of the US credit merchandise shake-out.
The company has today reported a preserve annual profit of $19.5 million saying its business is protected from the merchandise problems because it has no mortgage products of its own and is carrying no debt.
that the current merchandise turbulence is a return to the norm rather than something catastrophic.
"We may well see a bit of repricing in the merchandise and some of the ability to finance being fed through into interest rates," he said.
"But I think it's probably going to be a three to six-month phenomenon before we'll absolutely have a definitive judgement on that."
Mr Lahiff says smaller lenders will be most affected but it ordain not be catastrophic.
"I think probably the second and third tier lenders - those organisations that are having to fund themselves at slightly higher rates - will feed that [higher arouse rates] through," he said.
"But it only goes back to three or four years ago when they started off in this area and they were charging a higher rate there because normally these loans are riskier."
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http://www.abc.net.au/news/stories/2007/08/22/2012019.htm
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