Equifax’s latest Quarterly Consumer Credit Demand Index for the September 2020 quarter shows a near 30% decline in demand for consumer credit compared to September 2019. 

The results show a decline in every category, except for home loans, which rose by 16.3% in the quarter compared to a year ago.

Thinking about refinancing to a low-rate, variable owner-occupier home loan? Below are a handful of low-rate loans in the market. 

Lender

VariableMore details
4.6 Star Customer RatingsIncludes Nov RBA Rate Increase
  • Low rates for purchase and refinancing
  • Simple online application process
  • No fees, unlimited redraws, 0.10% offset
4.6 Star Customer RatingsIncludes Nov RBA Rate Increase

loans.com.au – Variable Home Loan (LVR < 90%)

  • Low rates for purchase and refinancing
  • Simple online application process
  • No fees, unlimited redraws, 0.10% offset
VariableMore details
Refinance OnlyApply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Refinance OnlyApply In Minutes

Unloan – Variable Rate Home Loan – Refinance Only

  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
VariableMore details
  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)

Up – Up Home Variable (Principal & Interest) (LVR ≤ 90)

  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of November 29, 2023. View disclaimer.

According to Equifax's data, credit cards suffered the biggest drop of 39.5%, which is not unexpected given the well-publicised fall in credit card use over the pandemic months. 

Buy now, pay later, despite reported increases in customers by the likes of Afterpay and Zip, as well as some recent negative press about customers missing repayments, also saw a 13.2% annual decline. 

The final two categories - car loans and personal loans - fell by 15.3% and 32.3% respectively. 

The Credit Demand index by Equifax measures the volume of credit applications for credit cards, personal loans, Buy Now Pay Later (BNPL), and auto loans.

Mortgage demand includes loans for new properties as well as refinancing.

Eqfxdata

How each credit category performed in each state. Source: Equifax. 

Why did credit demand fall so much? 

Kevin James, General Manager Advisory and Solutions at Equifax, said government stimulus measures like JobKeeper and JobSeeker have reduced the need for Australians to rely on credit. 

"This is particularly evident when looking at the volume of personal loan applications, which have dropped by around 30% for two consecutive quarters," Mr James said.

"As government stimulus starts to pull back, we anticipate personal loans may experience a revival, particularly among sub-prime borrowers who may not be eligible for other kinds of financing.”

Mortgage demand and applications, on the other hand, increased in every single state, even Victoria, which saw a 1.3% annual increase (the smallest among the states) despite being in lockdown for weeks on end.

Mortgage applications rose by 16.3% on average, led by Western Australia at almost 50% (48.3%).

The ACT also recorded an impressive 31.6% spike, while NSW was up 14%.

According to Equifax, home buyer activity is expected to further strengthen over the next quarter provided the virus remains contained, and interest rates remain low, especially now that Victoria is moving out of stage-four restrictions.

"Historically, movements in Equifax mortgage application demand data has led movements in house prices by around six to nine months," it said.

See also: ANZ says House prices to rise 9% in 2021

EQU-home

Source: Equifax 

Victoria actually had the largest decrease among all categories except buy now, pay later, which fell by 24.8% in Tasmania.

For the first time in more than eight quarters, the drop in demand for such platforms extended across every Australian state and territory.

“Despite the subdued interest in Buy Now Pay Later, there have been some interesting movements across generations. In the September quarter, baby boomers had the lowest share of enquiries for BNPL but the highest rate of growth," Mr James said.

"Generation Z accounted for a quarter of all enquiries even though they only made up 5% of the working adult population.

"And digital-savvy Gen Y has shown the largest shrink of any generation."

In Victoria, auto loans declined by more than 42%, and there was less demand generally in the eastern states. 

In the market for a new car? The table below features car loans with some of the lowest fixed interest rates on the market.

Lender

FixedNew1 yearMore details
Approval within 24 hoursEarly payout available
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
Approval within 24 hoursEarly payout available

New Car Loan - Special (Fixed)

  • Required: Good credit history, stable employment history. Aus citizenship or PR.
FixedNew1 yearMore details
Approval within 24 hours
  • Save the planet. Save thousands on your car loan.
  • 1% discount on qualifying electric cars
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
Approval within 24 hours

Green Car Loan Fixed

  • Save the planet. Save thousands on your car loan.
  • 1% discount on qualifying electric cars
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
VariableNew99 yearsMore details

New Car Loan (Home Owner)

    FixedNew2 yearsMore details

    New Vehicle Fast Loan Low Rate

      FixedNew99 yearsMore details
      APPLY ONLINE
      • Available for any new motorised vehicle
      • No ongoing or early exit fees
      • Flexible repayment options
      APPLY ONLINE

      New Car Loan

      • Available for any new motorised vehicle
      • No ongoing or early exit fees
      • Flexible repayment options
      VariableNew1 yearMore details

      New / Demo Car Loan (Variable)

        FixedNew1 yearMore details

        New / Demo Car Loan (Fixed)

          FixedNew, Used99 yearsMore details

          New or Used Car Loan Special

            FixedNew, Used7 yearsMore details
            No ongoing fees
            No ongoing fees

            Plenti Car Loan (Refinance)

              VariableNew99 yearsMore details

              New Car Loan (Non-Home Owner)

                FixedNew, Used99 yearsMore details

                Unsecured Car Loan Excellent Credit

                  FixedNew5 yearsMore details

                  Fixed Car Loan (New)

                    FixedNew, Used7 yearsMore details

                    Secured Car Loan

                      VariableNew, Used10 yearsMore details

                      Car Loan

                        FixedNew, Used99 yearsMore details

                        Car Loan

                          Important Information and Comparison Rate Warning

                          All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here.

                          The comparison rates in this table are based on a loan of $30,000 and a term of 5 years unless indicated otherwise. The comparison rates for car loans and secured personal loans for the relevant amounts and terms are for secured loans unless indicated otherwise. The comparison rates for unsecured personal loans are applicable for unsecured loans only. WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.

                          Monthly repayment figures are estimates only, exclude fees and are based on the advertised rate for the term and for the loan amount entered. Actual repayments will depend on your individual circumstances and interest rate changes. Rates correct as of November 29, 2023. View disclaimer.

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