Credit union increases investment LVR

by Julia Corderoy26 May 2016
Mutual lender CUA has announced changes to its loan-to-value ratios (LVR) on investment home loans.

Applied to all new investor home loans from Tuesday 17 May 2016, CUA has increased the maximum LVR from 70% to 85% across most variable and fixed rate home loans. Existing CUA customers, and new customers bringing their owner occupied and investor home loans to CUA, will be subject to a higher maximum LVR of 95%.

A maximum LVR of 80% will continue to apply for new and existing customers taking out CUA’s Fresh Start Basic (Investor) loan and Fresh Start Variable (Investor) loans.

CUA has been actively working to slow our investor home loan balance growth. The measures we introduced in 2015 have succeeded in managing our year-on-year investor balance growth below 10% p.a., as required by regulator APRA,” CUA head of product, Mark Petty, said.

CUA subsequently began winding back investor lending restrictions during March 2016. We have now made further changes to maximum LVRs for both new and existing CUA members taking out new residential investor home loans.

CUA is committed to maintaining the level of investor balance growth at around 10% p.a., and is closely monitoring our lending activity and reviewing lending policies as required.”