With banks in Australia continuing to tighten their investor lending criteria, a growing number of investors looking to invest in property Down Under are turning to second-tier lenders to bridge the gap.
Fresh loan-to-value restrictions and bank capital requirements have made it harder for buy-to-let landlords and developers in Australia to secure loans with a deposit of less than 40%, as reflected by a fall in lending to investors, which has dropped from $1.15bn (£712m) in January 2015, to $961m (£595m) this year - just $7m (£4.3m) of that was secured with a deposit of less than 20%, according to data provided by the Reserve Bank.
Although loans offered by second-tier lenders tend to be more expensive, they do help investors avoid delays with securing finance, which can result in a potentially lucrative investment opportunity being missed.
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