People look at new apartments in Bydgoszcz
People look at new apartments in Bydgoszcz in this September 29, 2014 file photo. Poland pressed its banks already on January 20, 2015 to provide relief for half a million homeowners faced with soaring repayments on mortgage loans denominated in Swiss francs and ordered an investigation into the lending practice. A surge in the value of the franc since the Swiss National Bank scrapped its cap against the euro last week has seen mortgage instalments jump on Poland's stock of franc-denominated home-loans - $36 billion-worth as of November, or almost 8 percent of output in central Europe's biggest economy. Picture taken September 29, 2014. Reuters/Agencja Gazeta

The cost of loans for the first-time home buyers is likely to increase very soon. ANZ Banking Group said the proposals are being worked out by the global financial regulators for customers interested in buying homes for the first time. The negotiated rules of the regulators state that people who have smaller deposits could end up paying more mortgage cost.

Graham Hodges, deputy chief executive of ANZ, said on Friday that the decision on the volume of capital that banks would need to carry will proportionately affect the borrowers with smaller deposits indirectly. The comments from Hodges were made before a parliamentary committee on housing affordability that also focused on the screening of profiles of investors before they are lent a particular amount, reported Sydney Morning Herald.

“We are working within the new regulatory framework to adjust lending requirements, especially for investment loans in a market that’s moving quickly,” he said in Melbourne. Hodges added that the proposal made by the international Basel committee needs to spread awareness so that it could enhance the vital changes in the capital requirements of banks so far as housing applications are concerned.

The propositions that are being considered will pose significant effect on the cost of finance, especially for those who borrow at higher loan-to-valuation ratios. “Over time, this will likely disadvantage those buyers, namely some first-home buyers, with smaller housing deposits,” according to Hodges.

The local analysts warned that the modifications in housing rules, which were unexpected for several years, might be weighed on loan-to-valuation ratios, while determining risks associated with the lent amount and also the capital to be held against it.

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