When applying for an average home loan from Westpac first home buyers will now be required to cough up an extra $12,500 more than before after Westpac announced policy changes that came into effect earlier this week.
All Westpac's managers and mortgage loan brokers were informed that all new customers would not be able to secure a loan unless they could meet a loan - to valuation ratio of 87 per cent as opposed to 92 per cent.
This will translate into having a monthly repayment of $1726 on an average $250,000 loan over a 25 year period.
These rules do not apply to existing customers.
The CEO of Infochoice felt that the move by Westpac would reduce competition in the marketplace, and that Westpac were indicating that they were reducing their home loan customer base.
Prospective first home buyers really need to see what home loans are available and which one suits their needs best.