The bank is also making it tougher for existing customers with investment loans by increasing charges by up to 60 basis points, as well as tightening terms and conditions for expat and offshore customers.
Bankwest has not fully explained to customers or mortgage brokers the reason behind these drastic changes. It is widely suspected, however, that the bank has exceeded, or is close to exceeding, the Australian Prudential Regulation Authority’s 10% lending speed limit, which is calculated on a monthly rolling basis.
An official memo that was disseminated to brokers said the bank “remains committed to supporting a stable national housing market” and will uphold policies that are in line with regulatory guidelines.
A Bankwest spokesperson confirmed the lender will no longer accept applications from new customers “seeking to refinance their standalone investment lending from other financial institutions.”
The spokesperson also said this move would impact a very small number of applicants.
“The bank continues to assess investment lending applications from current and prospective customers who meet relevant criteria within appetite,” he told the Australian Financial Review.
Bankwest has not provided any guidance on how long the new policy will apply and has offered no alternatives to brokers or customers.
“We will continue to monitor the impact this change has on our customers and the market, in order to maintain prudent lending and sustainable business,” the confidential memo said.
Collections: Mortgage News