Firm rolls out streamlined lending process

by Miklos Bolza18 Oct 2016
Financial services provider CUA will bring in a series of policy changes aimed at streamlining its lending process and reduce duplication in processing.
One of the primary goals is to introduce a more consistent approach to how the lender considers issues such as different types of income, periods of parental leave, lending for granny flats and the duration of interest-only loans.
“We are formalising a number of policies where we previously dealt with applications on a case-by-case basis, while other outdated lending policies are being brought into line with common industry standards,” said Natasha Kelso, CUA’s national broker manager.
“The changes also allow CUA to be more flexible in accommodating the needs of members at different stages of their lives – whether they’re starting a family, separating from a partner, relocating overseas for work, approaching retirement or building a granny flat for family members or as a source of additional income.”
As part of a broader policy review, CUA listened to feedback from members, lenders and brokers, Kelso said. While this first round of changes has just been released, the firm is already looking to how it can further meet the needs of brokers, staff and members.
Some of the policy changes in this initial rollout include the following:
  • Increasing the maximum loan-to-valuation ratio for home loan and investor refinancing applications from 90% to 95%
  • Introducing a flexible approach during parental leave for members who have taken out a home loan
  • Clarifying policy details around living expenses when a parent is not a fulltime carer for a child
  • Recognising additional dwellings such as granny flats as acceptable security for a loan plus recognising granny flat income
  • Giving investors a maximum interest-only period of 10 years on a loan and removing the current five year mandatory reassessment. The maximum interest-free period for other loans has been increased from three to five years
These changes came into play for all CUA loans processed from yesterday (17 October).
Kelso said that the feedback from brokers has so far been very encouraging.
“We ran our first broker workshop in Brisbane on Friday to advise those brokers and the feedback we received initially has been very positive. They’re quite excited around some of the policies that we’re instituting,” she told Australian Broker.
This is the start of a nationwide series of workshops CUA will be holding with brokers on all changes to be implemented.
“We’ve spoken to the fact that the feedback has come from them. They’re very grateful that we have listened to them and taken on what they’ve encouraged us to look at in regards to our policies,” she said. “They really like the fact that it’s black and white.”