Westpac yesterday announced a number of changes to its credit policy, which have also gone into effect across its subsidiaries: BankSA, Bank of Melbourne, and St George Bank.
Investor lending
Effective 22 October, the maximum loan to value ratio for interest-only investor loans was raised from 80% to 90% – including any capitalised mortgage insurance premium.
The update applies to new purchases, refinances within Westpac Group or externally, and loan variations such as switching from P&I repayments to interest-only.
However, the current switching policy will continue to apply, with customers only able to switch to interest-only repayments post 12 months of loan drawdown.
The changes will not apply to interest-only owner occupier loans, which will maintain their maximum LVR at 80%.
HEM calculations
Also effective yesterday, referral to credit will no longer be required in instances where expenses are greater than 130% of HEM and no other reason that requires credit assessment is triggered, a change the group expects to save brokers time and deliver faster outcomes to customers.
Updated resources
The group also launched an enhanced version of its Assess calculator, “developed in response to broker feedback.” It crafted the updated tool to be more intuitive and streamlined, making the completion of assessments “much quicker” and saving brokers valuable time.
Westpac plans to remain receptive to feedback moving forward, inviting brokers to “give it a go” and share their thoughts on their experience.
The older version of the Assess calculator will not be available for use after 15 November 2019.
