ANZ is loosening its conditions for borrowers requiring lender’s mortgage insurance ahead of a two month national marketing campaign to boost home loan volumes. In written communications issued to brokers on Friday, the bank revealed that it would soften its LMI requirements in a bid to widen the number of borrowers eligible for its mortgage products. From today, ANZ will begin treating child support payments as recognisable income for home loan applicants so long as the payments do not represent more than half of a prospective borrower’s net income. ANZ’s previous policy excluded child support payments as recognisable income. The bank is also binning a requirement for low-deposit applicants to supply evidence of all funds to complete a property purchase before approving a loan with LMI. However, the bank is retaining a requirement for applicants to supply evidence of 5 per cent savings when the loan to value ratio is greater than 90 per cent. ANZ will also ditch its cap on the number of credit facilities that can be consolidated with a home loan. The bank currently allows only four credit facilities – including the home loan – to be combined under a single loan agreement. “There will be no maximum limit on the amount of credit facilities able to be consolidated,” ANZ told brokers. ANZ is hoping that the relaxation of LMI conditions will widen eligibility for its home loans along with changes to its fixed rate pricing policy. The bank has launched a so-called “lock rate facility” that protects loan applicants shopping for a property against short term movements in a five year fixed rate mortgage. Under the arrangement prospective borrowers can pay a fee of A$375 on a $500,000 loan to lock in a prevailing five-year fixed rate so long as they draw down the loan funds within 90 days. In a video accompanying the notification to brokers, Natalie Smith the head of ANZ’s broking business said the bank was continuing to invest in its third party servicing back office. In 2021 ANZ’s outdated loan servicing platform triggered a disastrous blowout in loan assessment times. “Last year, we made several changes at ANZ, so we can continue to provide the fast, reliable, and consistent level of service that you expect for your home loan customers,” she told brokers in a video. “We focused on improving the assessment experience, we enhanced our policy settings, and we increased the number of BDMs and BDOs, to better help you assist customers looking to buy, upgrade or refinance a home.

“This year, we’ll continue to seek your feedback through our Voice of Broker Survey, so we can further enhance the policies, processes, and systems to support you.” According to disclosures made last week by ANZ, the average turnaround time on loan assessments is running at between 24 hours to 48 hours. That is a vast improvement on turnaround times in 2021 when brokers were waiting up to six weeks to have loan applications assessed.