The Association of Users of Banking Services, AUSBANC, is reporting that some banks are only granting mortgages for houses that the bank itself has in stock.
AUSBANC states that when a client goes to certain financial institutions to apply for a mortgage to buy a house other than one that the bank has in stock, the answe is usually ‘no’.
This practice, say AUSBANC, is not only unfair to potential home owners and developers, but is also prohibited.
Banks are trying to sell, at reduced rates, all the properties they have in stock – known as ‘dumping’ – before allowing credit to developers for the construction of new dwellings or to clients wishing to buy a house other than one owned by the bank.