The Rise of Non-Bank Lenders in Australia's Mortgage Market

May 7, 2024 by
Credit Connect Group, CCG

According to the recent AFR article titled ‘Non-banks raise $15b for mortgages the banks couldn’t write’, Australia's non-bank lenders are making significant strides in the Australian financial landscape raising an impressive $15 billion last year to fund mortgages that don't fit the strict serviceability standards set by major traditional banks.

This marked a substantial 30% increase from the previous year, highlighting a dynamic shift towards these non-bank lenders, such as Credit Connect Group, as a key resource for borrowers sidelined by traditional banks.  

With the first quarter of this year already seeing $4.45 billion in similar deals, it's clear that the momentum is not slowing down. This surge is partly fueled by the activation of wholesale funding markets, which has effectively reduced capital costs for the non-bank sector, making it a more attractive avenue for both lenders and borrowers alike.

The crux of this shift can be attributed to the tight lending rules imposed by regulatory bodies, which, according to chief executives of the country’s largest traditional banks, have inadvertently nudged borrowers towards these alternative lenders.  

According to the AFR article, non-bank lenders, such as Credit Connect Group, operate outside restrictions imposed on traditional banks thus offering them a unique position to serve customers who fall just outside the traditional lending criteria without the burden of APRA oversight.

As we navigate through these developments, it's becoming increasingly clear that non-bank lenders are not just a temporary fixture but a growing force in Australia's mortgage market. With their ability to offer more flexible lending solutions, they are slowly bridging the gap between what the banking sector can provide and the needs of the modern borrower.  

To read the AFR article in full, you can find it here.

Benefits of borrowing finance with CCG:

  • Experienced non-bank lender - Access funding not available via banks, credit unions or building socities
  • Trusted - Established in 2006 we have a track record of success
  • Fast approval and settlement times - We move quickly so you can act fast
  • No hidden fees - you are made aware up front of all fees. 
  • Flexible loans - You receive a personalised rate as no two loans are the same
  • Fixed rate, interest only - Lock in your rate and know what you are paying at all times
  • Tailored funding - Our products include commercial, residential, development, short-term business, newly-established property and much more...

If you have a scenario you are having trouble settling via your usual financial sources, speak to one of our BDMs on 1300 795 507 or email [email protected].

DISCLAIMER: The information provided in this article has been prepared by Credit Connect Group (CCG) for general education purposes only and is not intended to constitute specialist or personal advice. While every care has been taken regarding its accuracy no warranty is given or implied. The information contained herein does not constitute financial product advice and or an offer to invest. Investment can only be made by Sophisticated/wholesale investors as defined under the Corporations Act. Past results are not a guarantee of future performance. Investment into mortgages carries risk. We recommend that any investor obtain financial, legal, and taxation advice before making any investment with CCG. Copyright © Credit Connect Group. All rights reserved.

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