A bigger deposit to secure a home loan is an unpopular move but a wise one

We’re seen most financial institutions tighten up their lending criteria since the global financial crisis and considering what happened around the world on the money markets in the last 12 months it’s hardly surprising.

Recently, Westpac announced that first home buyers would need to meet a loan-to-valuation ratio of 87% instead of the previous 92%.

While some first home buyers are likely to be frustrated about needing to save more before entering the market, the reality is that buyers should have to show a solid and consistent savings pattern when securing a loan as well as a decent deposit – just as previous generations have had to do.

Let’s not forget that when the baby boomers were taking out their first home loans they were required to put down no less than a 20% deposit – far more than we’re required to now even just after the GFC.