Major Australian lenders are tightening their mortgage lending criteria, particularly around trust and company-structured loans, as risk appetites fall and credit standards are recalibrated in response to rising risk concerns.
Most recently, ANZ turned the dial down on trust and company lending, narrowing the avenues for complex borrowing and putting the spotlight back on traditional individual borrowers. The major tightened its mortgage credit requirements for home loans involving company or trustee borrowers. Under the new policy, starting 8 January, borrowers must be existing ANZ customers before applying for a loan: a minimum of six months with a personal or business ANZ lending product, or 12 months for ANZ term deposit, transactional or savings accounts. They must also have a "satisfactory account history," a director of the borrowing entity, hold at least 25% ownership and provide a personal guarantee. The maximum loan-to-value ratio (LVR) has also been reduced to 70%.
The move reflects a broader tightening in lending standards across the market, and concerns that layered structures can slip past standard checks, leaving banks exposed to hidden risks. By limiting new trust and company lending, industry players say banks will have less risk on their balance sheets.
"When buying a property in a trust and lending the money in that trust, there's a lot of checks and balances that don't take place, which means you could have people who are over-leveraged," Nick Reilly, founder and chief executive officer of Sydney-based brokerage Inovayt, told Australian Broker. "So there was a loop-hole, I guess you could call it, for people to borrow more money quicker, by buying through a trust. That's the thing that the regulators have put pressure on the banks to change their policies in a way that they lend to trusts."
It's little surprise then that ANZ's policy updates mirror previous moves by Commonwealth Bank (CBA) and Macquarie Bank.
In October, Macquarie paused all new home loan applications where the borrower is a trust or company. The bank cited rising application volumes, service pressures and upcoming anti-money-laundering compliance requirements as key factors behind its decision.
CBA followed suit in November, restricting trust and company lending in broker-introduced applications to borrowers, or guarantors, who have held an existing CBA lending facility — such as a home loan, personal loan, business loan or credit card — for a minimum period, typically six months.
For brokers working with investor clients, the tightening landscape places a greater emphasis on understanding lender-specific criteria and identifying alternative pathways for complex ownership and borrowing structures. At the same time, the pullback by traditional banks could be a boon for non-bank lenders, which have been gaining traction as stricter rules leave more borrowers outside the mainstream lending grid.
"As traditional banks tighten their lending criteria, we’re seeing more borrowers — particularly those who are self-employed or have complex financial situations — turn to non-bank lenders for solutions," Tony MacRae, chief commercial officer at Bluestone Home Loans, told Australian Broker. "Non-banks like Bluestone are built to assess each application on its individual merits rather than a rigid checklist. This flexibility often resonates with customers who don’t fit the mainstream mold.
"While we can’t predict the market with certainty, we do expect continued interest in alternative lending options as borrowers seek choice, speed and flexible solutions in a changing environment," he added.
Over at FinStreet, the non-bank lender has been "very, very busy" since the spring, said Founder and Managing Director Darren Liu. "We have been feeling it since October," he said. "A lot of activity moved to non-banks."
So much so that FinStreet had to temporarily close down refinance inquiries in December after receiving roughly 20 million applications in one week.
"That's why we think it will be very busy in 2026," he said. "I don't know about the whole market. But for non-banks, it will be very busy."
