Credit Conditions Set to Spike Earnings in 2026
The credit landscape is transforming favorably, promising an optimistic earnings outlook for 2026. The signs are clear, with surging mortgage enquiries, increasing new mortgage originations, and a record-breaking performance by the Australian Finance Group (AFG). This article takes a closer look at the recent developments and the resulting implications for the financial market.
Equifax Reports Surge in Mortgage Enquiries
A report from Equifax, a global data analytics and technology company, indicates a notable increase in mortgage enquiry volumes in December 2025, reaching a three-year peak. This is a significant indicator of the current financial climate, reflecting high engagement levels among consumers. The year-over-year enquiries for December 2025 marked an impressive increase of 17.9% compared to the same period in 2024.
New Mortgage Originations on the Rise
In addition to the rise in enquiries, the Equifax report also shows a year-on-year increase of 17.7% in new mortgage originations for December 2025. The data suggests a growing confidence among consumers in their financial stability and prospects, which could be attributed to the encouraging credit conditions.
Big Four Banks and Mutuals Dominate Mortgage Demand
Equifax’s data further reveals that the demand for new mortgages in December was largely dominated by mutual lenders and the big four banks. Mortgage enquiries with Mutual Lenders increased by a whopping 39%, while those with the big four banks saw a healthy rise of 27%. The data indicates the continued trust and confidence consumers place in these established financial institutions.
Record-breaking Performance by Australian Finance Group
Adding to the positive financial outlook, the Australian Finance Group (AFG) reported record-breaking mortgage activity across the country. The AFG Index for the December 2025 quarter revealed a powerful surge in mortgage activity, smashing the previous best Quarter 2 result by 25%.
AFG announced that total lodgements reached $31.6 billion, the highest quarterly result ever recorded by the Group. This marked a 3% increase on the previous quarter, taking FY2026 first half lodgements to a grand total of $62 billion.
Changes in Borrower Behaviour
The AFG data also highlighted a shift in borrower behaviour. First home buyer activity experienced a rise from 11% to 13%, showcasing the highest result since FY2022. On the contrary, refinance activity fell to 16%, marking the lowest level on record.
AFG CEO, David Bailey, attributes this shift to changing borrower behaviour. “The refinancing wave that defined prior periods has moderated,” he noted. This change suggests borrowers are becoming more confident and proactive in their financial decisions, further underscoring the optimism surrounding the 2026 earnings outlook.
These developments collectively point to a highly encouraging financial landscape for 2026. The surge in mortgage activity, the increase in first home buyer activity, and the record-breaking performance by AFG, all signal a sweet earnings outlook for the coming year.
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