Universal Wealth Management founder and owner Maria Rigoni has labelled the tougher lending criteria being imposed by major banks as "silly and ridiculous" as they continue to hurt prime borrowers who are finding it more and more difficult to borrow money or refinance.

"Lending criteria is getting harder and harder so really good, credit-worthy borrowers are being declined loans on the most simple and silly of reasons," she said in an interview with Your Mortgage's sister publication, Australian Broker. "Consumers are being stuck in high interest rate loans and you can't move."

Rigoni is referring to ANZ's recent announcement to mortgage brokers that it would change the way minimum living expenses were calculated when it decides on home loans. These changes, which took effect last April 4, will reduce how much some prospective customers can borrow.

"It interferes with a person being able to live their life and use their money as they see fit at a particular point in their life, and it stops lenders from being responsible for really making risk-based credit conditions," Rigoni said.

She also said that there is no reason to verify living expenses since relying on benchmarks should be enough. For Rigoni, asking clients where they are spending their money can be seen as an invasion of privacy.

The tough criteria are also undermining brokers. "The brokers are doing all of this work and then the deal doesn't go through and the broker doesn't get paid," Rigoni said. "I am seeing prime borrowers declined based on idiosyncrasies which are irrelevant."