NAB announced that it will roll out adjustments to its serviceability buffer for borrowers switching lenders.
In a statement released to the media, NAB said it will be “refreshing” its existing approach to support eligible refinance customers switching to NAB who have good credit histories but may not fully meet the current standard lending criteria.
The bank said changes to its serviceability rules will take effect by 21 July.
However, the bank said it will employ a “case-by-case” approach when assessing refinancers.
NAB’s move follows Westpac and CommBank’s decision to lower the rate at which borrowers are assessed when refinancing.
Only ANZ has yet to release any indication that it will lower its stress test. However, ANZ CEO Shayne Elliot recently said that the current buffer rate that the Australian Prudential Regulation Authority (APRA) set remains appropriate.
“I think 3% feels about right. We don't know what the future holds. It's completely unknown. We're very comfortable with the 3%,” he said during the review of Australia's four major banks at the House of Representatives.
Under APRA’s current prudential framework in assessing a borrower’s repayment capacity, banks must include a 3-percentage points buffer to be applied above the current housing loan interest rate.
When Westpac announced that it will be easing its refinancing rules, the APRA released a statement calling for banks to ensure that any changes to the serviceability rules to accommodate refinancers must still follow the core intent of its guidance on credit risk management.
Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.29% p.a. | 5.33% p.a. | $2,773 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.19% p.a. | 5.10% p.a. | $2,742 | Principal & Interest | Variable | $0 | $0 | 80% |
| Disclosure | |||||||||||
5.39% p.a. | 5.43% p.a. | $2,805 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure |
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