Powered by MOMENTUM MEDIA
subscribe to our newsletter

Lenders continue easing serviceability policies

Two more credit providers have announced changes to their home lending policies, as the market’s response to APRA’s new mortgage serviceability guidance continues. 

Teachers Mutual Bank Ltd (TMBL) and wholesale funder Advantedge are the latest credit providers to revise their home loan serviceability assessment policies.

The changes come in response to the Australian Prudential Regulation Authority’s (APRA) changes to its home lending guidance, in which it scrapped the 7 per cent interest rate floor for mortgage assessments and increased the buffer rate to 2.5 per cent.

TMB – which includes Firefighters Mutual Bank, UniBank and Health Professionals Bank – has lowered its interest rate floor from 7.25 per cent to 5.5 per cent and increased its buffer rate to 2.5 per cent.

The changes are effective for all new home loan applications from Friday, 26 July.

Advertisement
Advertisement

In a statement, TMB’s head of third-party distribution, Mark Middleton, commented: “TMBL welcomes the revised APRA guidance that allow us to continue to focus on supporting both our existing and future members as well as key workers and their families.”

NAB-owned wholesale funder Advantedge has also reduced its interest rate floor to 5.5 per cent – matching its parent company – and has increased its rate buffer to 2.5 per cent.

Advantedge’s changes will be effective for all new home loan customers from Monday, 5 August.

TMB and Advantedge join the likes of ANZWestpac, the Commonwealth Bank, NABMacquarie, Suncorp, MyState BankBendigo and Adelaide Bank, the Bank of Sydney and Auswide Bank, who dropped their interest rate floors to as low at 5.3 per cent.

All the aforementioned lenders have also increased their buffer rates to 2.5 per cent, as per APRA’s guidance.

PROMOTED CONTENT


Other lenders are expected to follow suit, including non-banks, with Resimac, which, along with the rest of the non-bank sector, is not formally bound by APRA’s guidance, also confirming that it is reviewing its policy.

[Related: Banks continue revising mortgage serviceability policies

Lenders continue easing serviceability policies
mortgagebusiness

If you’re feeling overworked and overwhelmed in this fast-paced mortgage market, it’s time to make some changes, and the Business Accelerator Program can help! Work smarter, not harder, in 2022 and beyond, visit the website here to secure your ticket.

Charbel Kadib

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

You can email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

The government has been told to develop a complaints process for businesses that have been dumped by their banks, following accusations of a...

An Australian fintech has introduced a new self-service VOI product for the mortgages market. ...

With low interest rates and income support expected to soon disappear, the major bank has released a revised dwelling figure. ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

Do you think APRA's bank buffer changes will see more borrowers use non-banks?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.