Some borrowers are unwittingly damaging their mortgage repayment history due to a "mismatch in timings", Smartline has claimed.

The brokerage has warned borrowers that mistakes in the timing between due repayments and household cash flow is seeing some borrowers unknowingly miss repayments. The company's managing director, Chris Acret, said the oversight may be damaging some borrowers' ability to secure credit in the future.

"“As a result of the GFC, all lenders considerably tightened up their lending criteria with a much greater emphasis on the credit worthiness of applicants. In this environment, you really can’t have a clean enough credit history for the lenders and any suggestion that a person can’t meet their debt repayments on time is a red flag," he commented.

Acret said the oversights could be particularly damaging to borrowers who find themselves in LMI territory.

"The mortgage insurers won’t even consider an applicant with any hint of loan arrears," Acret said.

By Adam Smith AUSTRALIAN BROKER NEWS

By Adam Smith - AUSTRALIAN BROKER

The RBA has reiterated the possibility of a rate cut while showing cautious optimism in the future of the economy.

In a speech to Citi's 3rd Annual Australian & New Zealand Investment Conference, RBA deputy governor Ric Battellino commented that the outlook for inflation had improved, and that easing inflation could provide scope for a rate cut from the Bank.

"The downward revisions to recent estimates of underlying inflation and the softer global economic outlook have made the outlook for inflation less concerning, providing scope for monetary policy to be supportive of economic activity, if needed," Battellino said.

Battellino pointed to upcoming CPI data, due today from the Australian Bureau of Statistics. He indicated that the data would provide further direction for the Bank ahead of its November board meeting.

While leaving open the possibility of rate cuts, Battellino expressed optimism at the state of the Australian economy. He commented that some sectors of the economy showing signs of life despite global volatility.

"Retail sales have picked up a little, housing loan approvals also seem to be picking up somewhat, most measures of business conditions remain around average levels and the most recent employment data have been more positive after a number of weak months," Battellino remarked.

Battellino also pointed to recent reductions in mortgage interest rates, and said average rates on new loans are now 10-15bps lower than early in the year.