01-Aug-2019 • Corporate

ME today announced two important credit policy changes

The first change is to its serviceability policy, following APRA’s recent serviceability guidance.
ME will decrease its serviceability floor rate to 5.25% p.a. and increase its buffer rate to 2.50% p.a. above the offered interest rate, for all home loan applications, effective 2 August 2019.
Whichever rate is higher will be applied when assessing home loan applications.
This change appropriately reflects Australia’s new low rate environment and opens up lending to more home loan customers.
The second change is to ME’s ‘loan to value ratio’ (LVR) cap for interest-only investment loans.
Previously ME restricted interest-only investment loans to 80% LVR or less.
This limit will be increased to 90% LVR effective 2 August 2019.