A major lender has removed its self-managed super fund (SMSF) products in order to streamline its product offering.
Westpac announced in a letter to brokers that from 31 July applications for new consumer or business lending will no longer be accepted for SMSFs.
As part of this, the Westpac s SMSF Investment Property Loan will be removed from sale and the Westpac Business Lending to a SMSF for buying residential investment and commercial properties will no longer be permitted.
This comes as other big banks are removing products from sale in order to streamline their offering.
Most recently Commonwealth Bank removed low-doc loans in order to ‘align with customer needs’.
For those who already have an SMSF loan at Westpac, the major lender has confirmed it will still continue to service these. This includes splitting loans, switching loan products and extending loan terms.
However, from 31 July, the lender will no longer permit switching from a principal & interest repayments to interest only, or extending existing interest only terms. Loans will need to revert to principal & interest.
There will be no impact on applications for new SMSF lending approved by Westpac Credit before 31 July.
In-flight applications for new SMSF lending will need to be received by a banker/partnership manager on or before 5pm on 31 July in order to be accepted.
For an application to be considered as being received, it must have a completed and signed customer application form including all required supporting documents.
Incomplete applications where supporting documents are not received will not be accepted.
Also, customer conversations must have been recorded by the lender’s banker no later than 31 July.
‘In-flight’ SMSF applications accepted will need to have obtained a formal Credit Approval by 30 October 2018.
No further loan approvals will be granted after the 30 October 2018. Any in-flight applications approved by 30 October 2018 cannot be re-approved or extended.
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