Credit Union Australia (CUA) has temporarily paused all new investment lending after a surge in enquiries sent loan growth skyrocketing.
This change will affect all new investment lending applications including applicants refinancing from other institutions. The lending freeze was announced on Friday (31 March), effective immediately.
CUA has stated that the pause will also impact investor applications which have yet to reach pre-approval, conditional approval or full approval.
The credit union had seen a sharp increase in investment lending in recent weeks, said Andy Rigg, chief operating officer of member services for CUA.
“We have been closely monitoring our year-on-year investor lending balance growth to ensure that we continue to lend prudently while remaining within the 10% regulatory growth benchmark.”
The increase in new applications was spurred partially in response to actions taken by other lenders to slow down their individual investor growth.
“In response to the continued growth in our investor lending and forward projections of this growth, we’ve taken the decision that we need to temporarily pause new investor lending.”
CUA was already in the process of implementing this decision to pause investment lending when APRA’s latest restrictions were announced on Friday
(31 March), a spokesperson told Australian Broker
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