Suncorp ramps up borrower scrutiny

Suncorp has announced that from 30 April, it will require brokers to ask all new applicants COVID-19-specific questions to discern the impact of the crisis on their financial position.

The non-major has asked that brokers document their assessments of a client’s financial position as part of Suncorp’s responsible lending obligations.

Suncorp’s new requirement mirrors changes announced by NAB and Resimac earlier this month.

NAB and Resimac are requiring brokers to document considerations of a client’s job/income security and any COVID-19 relief assistance they have received or requested, including loan repayment freezes or the JobKeeper wage subsidy.

Several lenders have also updated their credit policy, including Bankwest, ING, Gateway Bank, MyState Bank, Heritage Bank and ME Bank amid forecasts of a spike in defaults.

Other stakeholders in the lending industry have also adjusted their risk appetites, with mortgage insurer QBE Australia imposing an “embargo” on the provision of lender’s mortgage insurance to borrowers employed in industries hardest hit by the outbreak. 

In the same note to brokers, Suncorp has also announced changes to its serviceability benchmarks.

The bank has updated its HEM table and has reduced its retail floor rate, from 5.5 per cent to 5.3 per cent for new and existing home loan applications.

The changes are effective 1 May.

[Related: Big four cashed in on mortgage rate ‘lag period’]