It seems that today’s borrowers have lost interest in line of credit home loans with fewer such products being taken up by consumers than at any time over the past 13 years.
In November, 2011, only 3.7 per cent of home loans came with a pre-attached line of credit facility. This is well below the 10.2 per cent recorded in December 2005.
Line of credit home loans were extremely popular with mum and dad investors in the early 200s with many consumers relying on these to manage domestic budgets as well as investment loans. Borrowers would access the equity in their homes using line of credit home loans.
However as timed moved on so did the available home loan in Australia. Line of Credit products became more difficult to qualify for under the new NCCP legislation. Also these loans tend to be more expensive than the standard home loans with a free redraw facility. Many borrowers opt for home loans with an offset account and a redraw facility in preference to the old line of credit loans.
